Here's economic guru John McCain on the subject -- his sentiments are right, but the fact that he can't get the exec compensation to within 3 orders of magnitude is a bit worrisome. (I suppose Palin could have nailed it within two orders of magnitude or better ;-)
NYTimes: “It’s hard, it’s tough, but it’s also the classic example of why we need change in Washington. It’s an example of cronyism, special interest, lobbyists. A quasi-governmental organization, where the executives were making hundreds of — hundred some billion dollars a year, while things were going downhill, going to hell in a handbasket,” Mr. McCain said, adding that the two companies need “more regulation, more oversight, more transparency, more of everything, and frankly, a dramatic reduction in what they do.”
But not to worry, McCain / Palin's grasp of economics and finance is every bit as solid as that of our most recent great Republican leader George W. Bush, and look how well he did!
Video: [Bush, blathering off the record on something he doesn't understand -- was that Bush on July 18, or McCain this weekend?] "There's no question about it. Wall Street got drunk ---that's one of the reasons I asked you to turn off the TV cameras -- it got drunk and now it's got a hangover. The question is how long will it sober up and not try to do all these fancy financial instruments."
I'd post the video itself here except it's old news, and, well, nobody wants to talk about GW anymore -- especially not the people (the same ones who are backing McCain and Palin, more or less) who predicted what a great president he'd be. Too bad we don't judge voters on their records like we do traders. I know who I'd fire.
You voted for GW? Twice?!? Your P&L is negative one trillion dollars for the united states. Put your stuff in this box and follow the security guard out the door. No, you don't get to take a position on this election or advise any geneticists on evolution.
Note I'm not trying to blame Bush for the credit disaster -- the trillion dollars is for Iraq alone.
5 comments:
I like your trader analogy, but what happens to the analysis if Kerry and Gore would have put us 2 trillion dollars in the hole? I'm so depressed that the largest nationalization ever occurs under a Republican president and the opposition party wants to expand government even more.
Steve,
On the one hand, it is amazing to me (and most outside the US) that this election is even a contest---isn't the damage in EVERY sphere not obvious?
On the other hand, based on what I hear my colleagues at work think (some with advanced degrees), I am not surprised. One of them (a woman) said she was voting for Bush in 2004 because she did not like Kerry's wife! She is now voting for McCain, as (you guessed it) she does not like Obama's wife, and because Obama is a Muslim! Another guy said (with a straight face) that he is voting for McCain because he trusts the Republicans more on the economy. It turns out that he is against "big government", though he is counting his social security cheques. "Big government" is welfare, foreign aid and the like, btw.
I have realized that a fallacy in reasoning about democracies is that it is assumed that people will not actively vote against their interest. It seems that enough people here can indeed be fooled all of the time. So I would not bet against four more years of republican rule (does not even have to be racism, btw)...
MFA
Perhaps you define self-interest too narrowly. I happen to live in the heart of Republican territory. This area will again vote Republican even though they dislike McCain. They will do this because they define their self-interest in a much broader term than just financially. Social conservatives consider positions on marriage, abortion, and crime to be as important as fiscal policy. That doesn't mean fiscal policy isn't important but they really don't see any difference between either party on that subject. Both parties are simply variations on horrible. Almost all of my neighbors are fiscal conservatives. They save more than the average American and don't like debt though they will use it for major asset purchases.
Their definition of self-interest is different than yours. You seem to narrowly define it as fiscal policy only. They define it more broadly. Neither is wrong but you do seem to think that those that don't define it the same way you do are stupid. Is that fair?
Find someone that is a fiscal conservative, doesn't favor fiscal rewards to those that refuse to work, and that provides a social structure that helps reduce crime, promotes stable families and good schools and you will find the "idiots" will vote for that person regardless of which party they come from.
good story but wrong headline
should read Bye bye american middle class.
with the nationalization of freddie and Fannie the "ayn rand...market knows best...government is the problem...we dont need no stinkin regulation"...crowd ought to be silenced forever
but they wont. somehow they will lie a story about how its the governments fault, but facts are facts, and this financial crisis was free market driven...
no doc loans, exotic payment schedules, repackaging and bundling and tranching and securitizing of all manner of mortgage and consumer debt....the free market in all of its crazy, creative and unbridled greed and drunkness is at the heart of this sad affair.
our current president and his friends are largely to blame. many of them or their exponents have been around since 1980.. this is part and parcel of who they are...look at their philosophy:
they don't believe in anthropogenic climate change, they don't believe in evolution, they don't believe in astronomy and a universe that is billions of years old, they don't believe in labor laws, or health and safety in the work place, limits on drug companies and agribusiness marketing untested chemicals on the population...or in any sense a government that referees and regulates and maintains a level playing field for the little guy to stand a chance.
the neo-con republicans and the used-to-be-good republicans who let their party go to excess have lead us to a jungle world where anything goes...might makes right, survival of the strongest, richest and most powerful. they revel in war and the most extreme amongst them even try to justify our invaision of vietnam!
in short they are against civil society and civilization.
nothing makes more simplistically evident this truth than the simple paradigm of how the Bush people helped destroy labor unions...(poor Mexicans were used as foils) the neo-cons deliberately flooded our labor market with hard working, low paid, illegal immigrants and then completed the assualt on thee middle class with the outsourcing of jobs overseas at a breathtaking pace. the middle class has been defeated
although i fault in part previous democratic administrations, one simple picture makes it clear that clinton and gore were not half the bad guys and bush and reagan , were...are...look at the graph if you dare....it shows clearly which presidents added a mountain of debt to our country.
http://www.cedarcomm.com/~stevelm1/usdebt.htm
so now we are headed into a long, long night. those who think this is just gonna be a tough recession are failing to grasp the sheer magnitude of the numbers depicting the crushing debt... both private and public that overhangs our country and our collapsing economy. we have leveraged ouselved to a hell fashioned from unbridled greed. Collateralized debt obligations, Credit default swaps and all other manner of exotic derivatives exceed 700 trillion dollars in notional value..700 trillion!
the neocons plans are simple. They believe that with private armies and multinational corporate power they can survive and thrive after the emasculation of the US federal government, and the destruction of public health, public education, public utilities, public infrastructure, public service (military and social) and the hollowing out of medicare and social security.
maybe they are right and the elite will prevail
they have rolled the dice...anybody who thinks they know how this all plays out is a fool.
Perhaps you define self-interest too narrowly.
Good point. While it is definitely true for the base, I think it is not true for the swing voters that actually decide
the outcome of the election. Many of them want social security, universal health care and the other social entitlements, don't oppose gay marriage, are not into following "God's will", and are not that paranoid about crime... Yet they will still vote republican for superficial reasons (e.g., personal dislike of dem. candidate or his/her spouse).
Regarding the (republican) base, I would not consider them to be "idiots"; rather I would consider them to be impervious to reason on such issues. And at least some of their desires are mutually exclusive.
For instance, a consistent/rational position would be that to support the Iraq war one needs to pay for it by raising taxes (never mind that they got it wrong that it would "pay for itself"). But that would contradict the cherished "tax cuts is the cure-all" principle. This is unsustainable, and hence in that sense their choice is not in their interest and is "wrong" (except for the "end of Times" folks...).
"When the facts change, I change my mind. What do you do, sir?" ( Keynes). I know what the base does---simply ignores it! I think "faith-based community" is a proper description.
Of course, the lack of more than two parties does not help matters, but that is a different, long story....
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