Yet the urgent problem now isn’t TBTF [too big to fail], or even banker bonuses. These are distractions. The urgent problem is the giant riverboat gamble that Washington can save the economy by doing what comes naturally””spending money carelessly, creating massive new entitlements without funding them, dishing out cheap credit to politically favored sectors, telling business people where and how to invest.
Mr. Feinberg is an apt symbol indeed, for this gamble is built on the conceit that Washington can hector the recipients, whether auto companies, banks or homeowners, into behaving in ways that are “responsible.” So far, however, human nature is proving a disappointment: Take the outbreak of tax fraud related to the government’s emergency home-buyer’s credit.
Nor is the larger gamble looking so good either. Banks continue to fail at an alarming rate, the dollar is under assault, and Washington is looking at a future of trillion-dollar deficits. One might have guessed it would take a decade of Obamanomics to produce European welfare state levels of youth unemployment, but at 18.5% we’re there.
Actually, the more likely problem is that running a big deficit (CBO estimates about 4x last year’s deficit) may not help much since we’ve run a deficit ever since Clinton left office. Bank failures? Mostly they’re caused by stupidity that was years in the making.
Take a look at this and come up with your own balanced budget: http://www.kowaldesign.com/budget/index.html
Actually, except for 4 years under Clinton, we have been running deficits. It spans both parties, but go ahead and blame Bush if it makes you feel better. The Obama deficits make past deficits look like chump change. If deficit spending is good for the economy then we have it made and I am so glad that Bush was on the right track.
Oh, and 1, my comment is not intended as a response to you.