Which of the following issues will be most important to you when it comes time to cast your vote in November?
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Hot-Button Election Issues & Your PortfolioSeptember 8, 2008 By Jamie Dlugosch, Contributing Editor, Investors Insights |
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Issue #5:
Education is Our Future
Believing that the no child left behind program was under funded, Obama believes in supporting the budgets of the school system. Doing so will go a long way to increasing test scores in key areas such as math and science. He will promote pre-school programs and day care offerings to ease the burden of working families. He will also support teachers, rewarding those that perform. With respect to higher education, the hallmark of his program will be affordability for all. He will do so by using tax credits and a simplified financial aid application process.
Analysis: Education is the single most important tool for productivity within a capitalist system. Unfortunately, America has fallen behind in this regard. Making education a priority will require financial commitment. And while such a burden will pay huge rewards in the long-term, it may cause pain in the short-run.
Net Stock Impact: Neutral
McCain is hugely in favor of free market solutions to our education crisis. He believes that parents must have a choice in the schooling of their children. Having this choice will promote competition, thereby improving performance across the spectrum. Those schools that perform will receive the dollars under McCain’s plan. He does not believe in increasing spending blindly across a system that is inherently built for mediocrity and failure.
Analysis: Under McCain’s plan, the burden on the Federal government is lessened. The long-term benefits will accrue due to increased competition for scarce resources. Because the budgetary impact will be negligible, the impact on the market will be positive in the short-run. We can hardly afford more spending at a time of record deficits.
Net Stock Impact: Bullish
