An Economic Katrina

[marmar]

from HuffPost:




Joseph A. Palermo
An Economic Katrina
Posted March 17, 2008 | 03:46 PM (EST)



At this point in the Bush presidency most of us expect him to be totally indifferent to the plight of millions of Americans who have lost their homes in subprime Ponzi schemes. But who could imagine the son of the Carlyle Group being so cavalier in the face of Wall Street losses that might even "trickle up" to touch some of his daddy's friends?

On Friday, Bear Stearns, one of the largest firms on Wall Street, took a deathly plunge and the Federal Reserve (part of "Big Government") had no choice but to float a short-term bailout to the venerable investment-banking house lest the nation's financial system possibly collapse. At the Economic Club in New York, President George W. Bush did little to reassure a jittery Wall Street by saying, in effect: "Brownie, You're doin' a heckuva job."

Now that the "vision" for America of the cardsharps and market fundamentalists has born its bitter fruit, what is there to say to the Club for Growth, the Competitive Enterprise Institute, the CATO Institute, Americans for Tax Reform, the American Enterprise Institute, the Heritage Foundation, and other "think tanks" that have replaced academia as economic policy makers in the Bush years?

In the 1980s, it was the Savings and Loan industry. In the 1990s, it was the dot.com stock bubble. Then came Enron, Worldcom, and Global Crossing, and now we're facing an even more devastating economic crisis.

It's a familiar story: Corporations and trade associations hire lobbyists and donate campaign cash to gain access to elected officials. They pitch the virtues of "deregulation" citing "studies" from think tanks they finance, and imply there'll be plenty of money to go around for future campaigns. The cronies in Washington follow through and snip out laws and regulations that were carefully put in place by earlier lawmakers. The hucksters and profiteers poised to make big bucks on the new lax regulatory environment rush in and abuse it for all it's worth. And then they dump the wreckage on to society and on to the taxpayer.

The profits-driven propaganda of the free marketeers has filtered into the crevices of our popular imagination. We have soaked up the mythology that markets work magically if only government would leave them unfettered. Mantra-like, we hear it repeated through the corporate media. The right-wing think tanks produce cooked up studies "proving" that regulation is "costly" to airline travelers, or utility rate payers, or consumers of shipping services, etc. but they ignore the much larger costs that are passed on to society resulting from deregulation such as the last big stock crash that burned through $7 trillion in misallocated investment capital. ......(more)

The complete piece is at: http://www.huffingtonpost.com/joseph-a-palermo/an-economic-katrina_b_91929.html

[malaise]

1. Great read n/t

[marmar]

2. Agreed. Great breakdown.

n/t