Excerpt: "The fundamentals of the world economy aren't, in themselves, all that scary; it's the almost universal abdication of responsibility that fills me, and many other economists, with a growing sense of dread."
Portrait, New York Times columnist Paul Krugman, 06/15/09. (photo: Fred R. Conrad/NYT)
The Great Abdication
25 June 12
mong economists who know their history, the mere mention of certain years evokes shivers. For example, three years ago Christina Romer, then the head of President Obama's Council of Economic Advisers, warned politicians not to re-enact 1937 - the year F.D.R. shifted, far too soon, from fiscal stimulus to austerity, plunging the recovering economy back into recession. Unfortunately, this advice was ignored.
But now I'm hearing more and more about an even more fateful year. Suddenly normally calm economists are talking about 1931, the year everything fell apart.
It started with a banking crisis in a small European country (Austria). Austria tried to step in with a bank rescue - but the spiraling cost of the rescue put the government's own solvency in doubt. Austria's troubles shouldn't have been big enough to have large effects on the world economy, but in practice they created a panic that spread around the world. Sound familiar?
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In this case, since the actions being taken by the banks are irrational, it would be foolish to assign logical steps to resolve the problem. Instead, the actions all are directed toward blame. The banks are all implying that since Spain has messed up, it is Spain's responsibility to fix it. The bank's have ignored any role they themselves may have had in Spain's problems. They ignore the huge profits they made while Spanish property values expanded. The simplest explanation is that nobody in a position to fix the problem will do so, because in their mind, that means it would be their fault. That means they would then be expected to clean up after every future bubble bursts, especially if they made a lot of money from it. And that would simply eat into their profits, which is all this is about. Avoiding blame and retaining profits.
The crash is primed and ready and the Government is only making it more likely to happen. Obama is completely lost and has NO idea what to do, or how to even do anything! He is like a deer caught in the headlights, he is paralyzed! While Geither and the other economic fools steady the course!
The US Government is doing everything backwards, instead of stimulating the economy by taxing those that stole our money e.g. the Banks...and those who can afford it,e.g. the top 1% and the large multinational corporations... they are continuing to take from those who can least afford to be taxed in any manner or form. e.g. SS, Medicare, Medicade, Unimployment Insurance benefits and food stamps!
They continue to prop up Wall Street so that Wall Street will continue to pay their tribute to out public employees who seek public office...One of the biggest disgraces is Jamie "Demon" who the Government is subdizing with 14B a year as has just been discussed here. Obama's buddy in chief!
So, in my example, Wall Street has VD and they are f'ing all of us. Since they are so smart (see Mr. Dimon) and so important (too big to fail) we can all just die.
Watch "Low Spark of High Heeled Boys" tonight at 25 O'Clock!
Spain didn't mess up. The banksters messed up Spain.
"The bank's have ignored any role they themselves may have had in Spain's problems."
He's never going to get it.
"It is difficult to get a man to understand something when his job depends on not understanding it"
- Upton Sinclair
We are not children anymore, and the stakes are way too high; Obama is not the worst offender of the votes for sale politics; and Romney and all other Republicans are nothing but votes for sale candidates.
Not to nit-pick or anything but your mis-spelling re "givernments" is amusingly appropriate, as in "Give'er all to the rich and screw the rest", what?! Heh-heh! I'm not laughing at you B.T.W., as I'm particularly digitally challenged in typing, just the analogy which had an ironic appeal.
To my simple mind, most economic theorems are like a strange and obscure foreign lingo, so when I read something that evokes the thinking of Mr Krugman and other "normally calm economists" (and well-paid at that), I figure I'm not going to get it anyway but it's all goin' to come out in support of whatever sleights of hand are being pulled out of the economist's hats in benefitting the uber-capitalist s at any given time, whilst reducing the rest of us to a manipulable demographic bloc of different colors on a pie-chart or a set of figures with no meaning at the grass roots.
This crisis has been created and is really a power play. Those who are behind it fully intend to bring order out of the chaos they created. That will be obvious soon enough to all.
Actually I think the solution is one that will create many howls but it is this simple - birth control. We've gone gangbusters over the machination of almost all our task. We've created much easier ways to do things but failed to factor in what to do with the idle hands. Just look what idle hands come up with when they reside in WashDC and only have one task - unseating the current prez. If we can't create more jobs then the least we could do is create less needers of jobs. Oh shoot, that's right - that would require women's rights regarding contraception to actually belong to a woman. Never mind.
Those who ignore history are condemned to relieve it.
Or ... 99% of the economists can be wrong but if JUST one percent is right .. they point that they got it right by that ONE PERCENT! Any more stupid articles about economists predictions... and even KRUGMAN should lose his job!
The real conflict here is between those who espouse laissez faire economics (minimal interference with the workings of the unregulated marketplace) and those who are old enough to remember when government actually intervened on behalf of the weak and powerless (before Reagan/Thatcher).
My solution is to let Romney and the Republicans sweep the next election and then run us over a cliff, hopefully convincing American voters to reject their idiotic ideas once and for all. Clearly, only a major crisis will get the attention of those who only want to keep going to work, noses down, accumulating material indulgences, until the planet itself dies from our poisons.
I have a quote from Wendell Phillips on my desk: "Only by unintermitted agitation can a people be kept sufficiently awake to principle not to let liberty be smothered in material prosperity.
I will admit I am wrong if your projection comes true.
Will you admit being wrong if the Republicans take over and we have another Great Depression compounded by a Recession?
How about if Obama wins, the Senate gets a filibuster proof Democratic majority and the House flips back and the economy soars? Will you admit being wrong?
I'd buy a ticket to THAT admission -but don't hold yet breath.
Honestly, my biggest fear with Mitt is how deep in debt he has gone to the Extreme Right. He personally is far from the worst Republican, he is just not very good as a political executive. He actually does know the Righties are nuts but I don't think he has a clue how to walk the tightrope required of a President, because as a CEO of a private corporation he just would find ways to shuffle the deck and make sure of only one thing; he got the aces.
As Governor, he attempted the same thing and found his options limited, and the results were poor, but not devastating. Also, he was only in political debt to Bush II. As President, there is no room to shuffle and the political debt suffocating.
The governments that sit on their hands when they can be doing something to solve the problems that they allowed to be created in the first place will say it wasn't their fault when the next crash happens.
That must be congress you are talking about for they REFUSE to move on the measures Obama ask them to. Any idiot can see, that to get people working on all the infrastructure needs is the thing to do It is a win, win strategy .... even if you borrow to get it started.
To get many people working will be a
shot in the arm for the economy. We should All DEMAND THAT CONGRESS ACT NOW!
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