If the LA Times Is This Cynical

Obama’s economists had more hubris and less ambition than Reagan’s. They thought they could predict events accurately and put just the right policies into place. And that was before politics interfered, cutting the actual package to well below what Romer thought necessary. Larry Summers, however, was later quoted saying that he still thought the stimulus was about right, which raises the question: Why didn’t it work as planned?

In fact, stimulus alone was never going to bring recovery. This crisis was caused by financial collapse, rooted in massive banking fraud. The financial system is our economic motor and when it fails it cannot be revived simply by pouring money on it, any more than a wrecked reactor can be restarted just by adding fuel. Team Obama faced a situation not seen since the 1930s — a worldwide banking meltdown. The financial system needed to be rebuilt — and it still does.

But Team Obama chose to overlook this.

…can the Grey Lady’s reality check awakening be far behind…?


You’re right. You’re right. “What am I THINKING?!?!?!” Duh.

(HT @gabrielmalor.)

One Response to “If the LA Times Is This Cynical”

  1. aelfheld says:

    The LA Times is blowing some major smoke. The financial crisis was, and remains, largely a creation of the unfettered and expansionist government they favour — the implicit federal guarantees of both Fannie Mae and Freddie Mac gave dodgy paper a value it would not have had were it the bank’s money on the line.

    The banking system doesn’t need to be ‘rebuilt’, at least not in the fashion the LA Times means; given its track record, the federal government needs to be extricated from the banking system, not immured further.

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