Leave It to Larry

to defend Obama's kowtowing to Wall Street as Summers is one of the architects of Obama's economic policies.

Obama

had better get his shit together on the economy and get rid of the likes of Summers and Geithner or the public is going to lose all faith in his ability to turn things around:

It is becoming increasingly apparent that our economic recovery measures are being designed and implemented exclusively from Wall Street's point of view. The needs of investment bankers, stock speculators, corporate bankers, hedge fund operators, and insurance moguls are taking total precedence over the needs of the American taxpayers and the American people, particularly including those who have led frugal, responsible lives and have much of their assets in savings. A day of reckoning will come in response to the printing of almost $3 trillion in greenbacks that have been given to these institutions, and the effects of this behavior will hit hardest on those whose holdings are primarily in American dollars -- the "prudent" savers among us -- and on working Americans whose salaries are not adjusted according to fluctuations in monetary rates. It will hit hardest on those with fixed incomes.

Summers and Geithner (and to a slightly lesser extent Bernanke) seem to be striving to return Wall Street to the "good old days" of business as usual c. 2005-2006. They seem intent to measure our economic performance by the Dow, and wish to restore the health of our megabanks and mega-brokerages. I do not believe this to be the solution.

They are not trying to design a new, stronger, more resilient financial system less vulnerable to bubble-and-bust. I do not believe that Summers and Geithner are the guys for that job, but that's the job we need to have done. Instead they are trying to rehabilitate the current system, and it is the current system that has failed. Geithner is a bean-counter and might make a better Treasurer than Secretary of the Treasury. Summers, through and through in his heart and in his mind, is an investment banker -- it is all he knows and all he sees. He completely identifies with their needs and aspirations and will do everything he can to make life good for his colleagues in that field. But it is regulating, and indeed governing, in the exclusive interests of these very people that have caused our ruin and that will prevent our recovery if we continue to do it.

The AIG debacle is just a big red flashing light -- important to deal with, but not the actual danger. We are absolutely right to be outraged by those bonuses but we are ignoring the greater lesson of them -- the "bonus system" of compensation itself that encourages exactly the kind of dangerous behavior that has given us the current disaster. Think: What are those bonuses granted for? Designing and marketing innovative financial instruments; hawking the greatest volume of high-risk investments to unsuspecting investors; selling the most snake-oil insurance policies; outsourcing jobs and entire industries to overseas firms; and in more industrial fields, closing manufacturing plants and laying off the most employees in the name of "productivity." Are these the things we really want to reward at the level of a winning lotto ticket (another recent abomination created with the purpose of shifting the tax burden onto the backs of the poor)?

And yes, our economic policies should move sharply to the left. No more Chicago school, neoliberal, or Friedmanite nonsense.

More Krugman

It appears the Obama administration is wedded to the discredited economic policies of the past when in fact there needs to be drastic change:

The Obama administration is now completely wedded to the idea that there’s nothing fundamentally wrong with the financial system — that what we’re facing is the equivalent of a run on an essentially sound bank. As Tim Duy put it, there are no bad assets, only misunderstood assets. And if we get investors to understand that toxic waste is really, truly worth much more than anyone is willing to pay for it, all our problems will be solved.

Paul Krugman Nails It

Obama needs to cut out the post-partisan horseshit with people who, because of a twisted ideology, want to throw this country into a third world paradise, and actually DEAL with the problem. He needs to go on the offensive.

Ditto for ALL of the Democrats in Congress. They are in power, and fuck this shit of dealing with the McConnells of the world who do not care one goddamned bit about this country.

The economic crisis is really dire.

The Booming Economy

Macy's will close 11 stores because of the crappy economy.
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December retail sales were down in the ditch.
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Obama will reveal his economic recovery plan.
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The Economic Mess

Obama vows to quickly put in a vast economic stimulus package, assuming the fascists don't shoot it down:

President-elect Barack Obama said Saturday that he had started work on a sustained, two-year economic stimulus plan designed to create or save 2.5 million jobs, funnel money toward public works programs to repair the country’s failing infrastructure and invest in alternative energy programs.

Mr. Obama’s plan, which he announced in the Democratic radio address, is broader than the pledges he offered while campaigning for president. He said the deepening financial outlook demanded more robust action, so he directed his economic team to devise “a plan big enough to meet the challenges we face that I intend to sign soon after taking office.”

Let's hope for the best because the situation is truly dire.

I can hardly stand to look at anything on any site because the news is so depressing. That's one reason why I haven't done much posting since the election, which is reflected in my stats. Another is I am busy with other things, including trying to get caught up on the DVDs.

Campaign Follies

Now that Obama has tried to burnish his foreign policy credentials by globetrotting all over the place saying nothing in particular, he will have to try and burnish his economic credentials while at the same time hiding his Friedmanite connections.

Expect his "progressive" supporters to continue to carry water for this Republican-in-Democrat's-clothing.
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