Change, meet crisis

Barack Obama was elected with a mandate for economic change on a scale that hasn't been seen in decades.

So what does he do with it?

During two years of campaigning, Obama set forth detailed proposals for tax relief and enhanced government benefits for the middle class, the poor, college-bound students and the elderly.

He called for new government investments in infrastructure and "green" technologies, as well as a dramatic expansion of health insurance largely by making a Medicare-style program available to all.

He now faces a challenge familiar to every other newly elected political leader: how to transform ideas tailored to win votes into something suitable for the real world.

And he will almost certainly have to adapt some of his proposals to accommodate the current financial and economic crisis.

The urgency for action was underscored by another sharp drop in stocks Wednesday, with the Dow Jones industrial average plunging 486 points, or 5%. That brings its decline on the year to more than 31%.

"Obviously the agenda's been taken over by economic conditions," said James K. Galbraith, a professor of finance at the University of Texas and an economic advisor to the president-elect. "There's no reason to think these are going away in six months."

But insiders say Obama may have to mediate between opposing camps on his own economic team. Moderates are cautioning against stimulus efforts that might sharply increase the budget deficit, while others are urging the kinds of aggressive measures associated with President Franklin Roosevelt. During the depths of the Depression, FDR implemented a wide-ranging public works program, aid for farmers and homeowners, and social welfare programs such as Social Security.

The recessionary economy, and the expense of the government's financial rescue program, will undoubtedly complicate Obama's efforts to implement his economic plan. But some advisors say he won't be inclined to abandon his key goals.

"It would be very difficult to come in and say, 'That agenda I've been pursuing for a year and a half? Never mind it,' " Jared Bernstein of the liberal Economic Policy Institute said during an interview with The Times last week.

But Bernstein, a key Obama economic advisor, acknowledged that some economic issues may have to be addressed with greater urgency to provide a foundation for others.