Bailout deal helps Obama so far

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Even with a Ph.D., political science professor Chris Owens finds the $700 billion bailout deal confusing.

However, he said so far it is helping Democratic presidential candidate Barack Obama.

“It’s allowed Democrats to make the economy the issue,” he said. “Both candidates will try to blame the other party.”

Former Griffin Endowed Chair Bill Ballenger agreed the bailout deal is helping Obama but said the entire economic crisis has been helping him.

“It’s not so much the bailout itself,” he said.

Economics professor Jason Taylor said polls are showing the Republican Party is hurting.

“It was pretty much even money last week,” he said about which candidate was favored to win the election. “Now it looks like Obama.”

Taylor said the idea of a big government program goes against conservative principles, hurting Republican presidential candidate John McCain, who has already had to convince the Republican Party that he is a conservative.

“His core base of people were more offended,” Taylor said.

Time will tell the full effects of the bailout on the election.

“I just think it’s too early to know whether the bailout is going to work,” Ballenger said.

Taylor said the bailout should be called a government investment program instead.

“I think the term bailout is a pejorative term,” he said.

Taylor said what the bailout really does is invest $700 billion in assets, houses and mortgages – “toxic assets” – to try to make money off of them.

“They’re not just throwing $700 billion at the problem,” he said.

Taylor said the deal was probably the right thing to do but that it presents a moral issue if big businesses can expect to be bailed out every time they get in trouble. This could lead to more businesses taking risks, saying, “If it works, I keep the profits, if not I get bailed out,” Taylor said.

“I think it will help a little, but I don’t know if it’s the magic bullet, everything’s hunky-dory again – probably not,” he said. “It looks like we’re still headed for a recession.”

Taylor said he does not see another Great Depression happening, though the unemployment rate may reach the 8 to 9 percent seen in the 1981 recession.

“I don’t think it’s going to get any worse than that,” he said. “I like to think in the next couple of months we’ll hit bottom and recover.”

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