Wednesday, July 17, 2013

With choices like these, who needs enemies?

Let's look first at the Republicans. Commenting on the House of Representatives passing farm assistance legislation without a single penny included for food assistance for impoverished Americans, Paul Krugman wrote in his New York Times column
Something terrible has happened to the soul of the Republican Party. We’ve gone beyond bad economic doctrine. We’ve even gone beyond selfishness and special interests. At this point we’re talking about a state of mind that takes positive glee in inflicting further suffering on the already miserable...  Somehow, one of our nation’s two great parties has become infected by an almost pathological meanspiritedness, a contempt for what CNBC’s Rick Santelli, in the famous rant that launched the Tea Party, called “losers.” If you’re an American, and you’re down on your luck, these people don’t want to help; they want to give you an extra kick. I don’t fully understand it, but it’s a terrible thing to behold. 
By the way, Truthout last week carried an article by Jeannette Wicks-Lim, Undercounting the Poor, which detailed both how inadequate official government statistics are, and how important government programs are in lifting millions out of poverty.

So, now let's look at the Democrats. A few days ago, Barry Ritholtz wrote,
At a dinner last week laden with economists, our discussion turned to who will replace Fed Chair Ben Bernanke. The consensus was Janet Yellen was the front runner, Roger Ferguson was the long shot . . . and then Lawrence Summers’ name arose.
Is it actually possible that Larry frigging Summers is still a respected entity in the Obama administration or among Democratic Party lawmakers? Of course, Ritholtz doesn't say one way or the other that Summers is being considered by Obama. But the next day, Dean Baker warned that there are indeed reports coming from certain business media that there actually is a campaign "among Washington insiders" to make Larry frigging Summers the next chairman of the Federal Reserve System.

Ritholtz supplied a short list of Summers' blunders that should make Summers persona non grata anywhere near a policy making position. Correct that: a short list of Summers' many and massive blunders:
• He has consistently argued for privatization and deregulation of the financial sector;
• He oversaw the repeal of Glass-Steagall via the passage of the Gramm-Leach-Bliley Act;
• He approved the (previously illegal) merger between Citibank and Travelers;
• He oversaw (and indeed encouraged) concentration in the financial sector, thinking bulked up banks are a virtue. This led to the rise of the TBTF institutions (formerly known as mega-banks).
• He successfully fought Brooksley Born, then chair of the Commodity Futures Trading Commission, to rein in financial derivatives;
• He oversaw passage of the Commodity Futures Modernization Act of 2000, preventing ALL Federal regulation of derivatives; The CFMA also exempted derivatives from state insurance oversight and antigambling laws.
• Thanks to Summers, derivatives still have no minimum reserve requirements, no disclosure obligations, no transparency and no exchange listing / reporting requirements.
After he helped to create the financial crisis and collapse, Summers found himself uniquely situated to help repair the damage he wrought. But that would have required an admission of error and responsibility; instead, he compounded his errors by pushing for a small, ineffective stimulus plan.
Note we have not even bothering with his issues with woman, his lack of collegiality, his inability to work well with others, his boorish head strong personality, and his other professional failings.
The mere idea of making Summers Fed chairman really should be causing massive hysteria among progressives and Democrats. There really are very few people who are more culpable than Larry Summers for the completely unnecessary destruction of our economy that past few decades, culminating in the financial crash of 2007-2008.

As Charles Ferguson, who created the web page building application Front Page, then sold it to Microsoft, and then used his riches to research and put together the Oscar-winning documentary film about the financial crash, Inside Job, wrote back in October 2010:
Summers is unquestionably brilliant, as all who have dealt with him, including myself, quickly realize. And yet rarely has one individual embodied so much of what is wrong with economics, with academe, and indeed with the American economy. For the past two years, I have immersed myself in those worlds in order to make a film, Inside Job, that takes a sweeping look at the financial crisis. And I found Summers everywhere I turned. (Emphasis mine.)
And we have not even begun to consider Summers' especially disastrous role as director of President Obama's Council of Economic Advisers from January 2009 to December 2010. As detailed in Ron Suskind's latest book, Confidence Men: Wall Street, Washington, and the Education of a President, Summers was ruthless in suppressing any economic views he did not agree with from reaching Obama. Together with former Treasury Secretary Tim Geithner and former White House Chief of Staff Rahm Emanuel, Summers made certain that no actions in the least bit punitive were directed against Wall Street. Thus was squandered a truly historic opportunity to fundamentally change the course of U.S. economic policy and history. By Larry frigging Summers.

It is no comfort at all that Democratic elites do not take the same perverse pleasure "in inflicting further suffering on the already miserable" like the Republicans do.

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