Economic Reform

The Obama administration's plan to stave off foreclosures could fall flat in California, where nearly one-third of mortgage holders are underwater on their loans -- many of them by amounts that would disqualify them for government-sponsored refinancing. The problem is likely to be especially acute in areas like the Inland Empire, where homes have lost more than 40% of their value in the last year and nearly half the homeowners owe more on their loans than the properties are worth.

A massive spending bill expected to be approved by Congress this week is filled with more than 8,500 earmarks -- those pet projects that lawmakers love -- costing $7.7 billion. Despite the tough economy, mounting federal budget deficit and pledges by President Obama and members of both parties to crack down on the practice, a number of lawmakers have defended their earmarks as important to the nation's economic recovery.

President Obama billed it as an adrenaline jolt -- a $787-billion stimulus package that not only would put people back to work, but also underwrite construction and energy projects the country had long neglected. But with the economy still sputtering and some experts doubting the program was meeting its goals, Obama vowed Monday to accelerate stimulus spending with the goal of creating or saving 600,000 jobs by summer's end.

The $825-billion stimulus proposal that Democrats unveiled this week may encounter stiff opposition from conservatives on Capitol Hill. But it isn't meeting significant resistance from conservative economists. Though economists might quibble with specifics or express concerns about longer-term effects, the vast majority agree that some kind of massive government spending plan is necessary. "Most conservative economists are all for it," said Mark Zandi, a founder of Moody's Economy.

In unveiling President Obama's long-promised strategy for reviving the nation's moribund financial system, Treasury Secretary Timothy F. Geithner on Tuesday offered few details on such crucial issues as helping homeowners avoid foreclosure or clearing away the toxic securities at the heart of the banking crisis. The dearth of details, which sent the stock market into a tailspin, reflects a double bind for the Obama administration.

Mac is back. But now, Sen. John McCain is cutting a new profile -- one that is far more partisan than when he became so familiar to Americans months ago as the Republican nominee for president. As a candidate, McCain cast himself as a uniter of the two parties, willing to buck his GOP colleagues and reach across the aisle to build compromises on immigration, campaign finance and other hot-button issues. "I have that record and the scars to prove it. Sen.

Any capitalist nation must be willing to embrace some level of economic Darwinism: the notion that the fittest survive while the less robust fall away. But what America is living through now is a drastic and high-speed wave of Darwinism that reaches every corner of the economy and financial system. We're on failure overload -- which is why this all feels so frightening and why markets remain in disarray.

President Obama's economic sit-down with congressional leaders Friday ended with senior Republicans sounding less confrontational than they had in recent days. As they emerged from the White House, however, GOP leaders released a counterproposal to the Democrats' $825-billion economic stimulus package -- suggesting that although the gulf separating the two parties on economic policy may have narrowed, it has not closed.

Campaigning for the top priority of his upcoming presidency, Barack Obama pitched his economic recovery plan on Friday by using an old-economy plant now finding new business in alternative energy. Obama's stop at Cardinal Fastener & Specialty Co. came the day before he starts a weekend of activities -- including an Abraham Lincoln-inspired train trip from Philadelphia to Washington -- before his inauguration Tuesday.

Democrats talked about the jobs to come from modernizing the electric grid, weatherizing homes, and repairing roads and bridges. Republicans too had ideas for reviving the economy, focusing on tax cuts and carefully targeted spending. But many in the GOP also wanted to talk about something else: sexually transmitted diseases.