True Confession (like the Magazine)

I often do not agree with Paul Krugman, which is not to say that he is wrong about much of anything; it is all a question of the direction of policy. It is especially true about this One. I was worried about Geithner from the time he was nominated to head Treasury. One does not elect one of the leaders of the outlaw hideout to clean up the place! Every proposed Solution under such a Plan comes after the complete approval of all the constituent gangs at the Hideout. It is the same here, where all the Constituents are a part of the coalition which gives Geithner the power to maintain his position. It is not an Accident that Geithner’s Plans sound like a rehash of the Paulson Plans, as they originate from the same source with the same constituent support. This gets support in Washington, because Congress receives the same support under Obama, as they did under Bush. One does not ask the same people for a new Plan, when the old Plans maximized the Profits of those people in the first place.

Krugman still proposes that the Situation calls for a flow of massive Cash into the economy, this Cash will be left in the hands of the same old Crew to distribute, even though they are still the Crew which brought the Crisis in the first place. I would propose that We have stumbled along in Crisis for about a year now, with the Write-Downs ground through the system, and We could continue as is without much trouble. Krugman deplores the loss of Jobs, and the loss of Income for Homeowners. The first assessment must be that those Jobs cannot be saved anyway, and there is no guarantee any new Jobs will be generated by any massive inflow of Cash; the greatest indication being that all funds will be diverted to refilling the Coffers of Those who caused the initial Crisis in the first place. Homeowners are going to face a loss of the worth of their Homes anyway, and they should not have their Homes set up as a Credit-raising vehicle. We are within a Downturn, and that Downturn comes from a real Need to excise Credit over-extension from the system, a factor which will not be helped by an inflationary infusion of Cash into the economy.

President Obama has already squandered his credibility, basically due his attempt to connect promise of change with the same old Plans of Congress and Wall Street; it deriving from his intellectual grasp coming only from one source; the political fund-raising from Special Interests while in the Senate. These are not the intellectual resources necessary to get a well-rounded grounding in the economic issues at stake. A Two-Year old vehicle with 200,000 miles on it is as difficult to Sell, no matter what Advertising campaign is used; People recognize that the Vehicle will do nothing for themselves, when they need something which will get them down the Road. The Best Plan may very well be to Do Absolutely Nothing; letting the Banks stumble along until they have Written Down all the bad debt. lgl