Up is Down
Who said this?
I would not be for nationalizing [the banks] … I don’t think government is good at making these decisions.
And what about this?
I’m very much afraid any program to salvage the banks is going to require the government … I would not take off [the table] the idea of nationalizing the banks.”
Would it surprise you, as it did me, that the first comment was made by a leading Senate Democrat and the second by a leading Senate Republican? WTF? Don’t believe me? Check it out — and then, buckle up … because this thrill ride, I suspect, is just beginning.
—————-
For some history on what happened in Japan in the 1990′s:
- “In Japan’s Stagnant Decade, Cautionary Tales for America,” New York Times, Feb. 12
For both sides of the debate over nationalizing banks, I recommend the following (h/t Sullivan) …
- “The Limits of History,” New Yorker, Feb. 13 — James Surowiecki questions nationalization
“Nationalize the Banks! We’re all Swedes Now,” Washington Post, Feb. 15 — Matthew Richardson and Nouriel Roubini favor nationalization
And finally, for a peak into Obama’s mind on the matter (h/t Sullivan, again) …
Obama refused to close the door on a broad range of possibilities. One of his interviewers asked him to compare his approach to the responses to earlier banking crises in Japan — which faced an economic “lost decade” after failing to intervene forcefully enough — and Sweden, which temporarily nationalized its failed banks before selling them off. Obama said the administration was trying to find the “sweet spot” between those alternatives. Japan offered no model, he said, because “they sort of papered things over and never really bit the bullet.” And while many on the left are urging Obama to follow Sweden’s example, he thinks the scale of the U.S. problem argues against that course. “You can make a good argument for the Swedish model except for this fact: They only had a handful of banks; we’ve got thousands of banks,” he said. “The scale, the magnitude, of what we’re dealing with is much bigger.”
Strikingly, the president would not rule out more direct government intervention if his initial approaches fail. “What you can say is I will not allow our financial system to collapse,” he said forcefully when asked if he was excluding a Swedish-style solution. “And we are going to do whatever is required to get credit flowing again so that companies and consumers can do their business and we can get this economy back on track.”
10 Responses to “Up is Down”
We know about those like Krugman, emerging from the rocks to exhibit their predictable blatant lefty politics in support of nationalization and other overreach when the opportunity presents itself (not just the bank troubles, but his fellow Dems firmly in power). That disgusts us, but is no surprise.
But while yes, there are plenty of big-Government Republicans (including the softies who don't want to rock the boat or question any kind of big government in Washington so long as it's not too obviously liberal or Democratic in nature), it's ironic in multiple ways to hear this guy, Graham, say this. So surrender and even collaboration (reluctance being real or feigned) is the dysfunctional Republican “logical” response to being “screwed” insofar as bi-partisanship now means “do it the Democrats's way, with no dissent tolerated”? [shrug] “If you can't [or would not, for various reasons] fight them, join them” is actually nothing new among Republicans in Washington over the decades. It's particularly telling here, though.
The stampede toward nationalization will likely gain momentum. A frequent rationalization (which actually constitutes no justification at all — two wrongs aren't better than one) is that control is justified given the financial commitments (at least) made in the form of the bailout.
Do you realize that (as with federal financial aid to schools, more broadly all the demands that accompany highway funding, and such) there is logically or technically no limit to federal control over anything using that rationale? No limit whatsoever?
Pete, coming later is an ambitious broadband effort — at least it's promised now. Realize the lefties more than any righties ever would be the ones who would not only start making all kinds of infrastructure, material, financial decisions for telecom firms, but also content rules.
As with the lousy “stimulus” [sic] bill, hopefully too great a mess won't be made with any (likely, it seems, if not eventually) “AmBanks” effort.
I don't know how to break it to you all (yet again), but we nationalize banks all the time. It's called the FDIC. Sometimes they turn them over to another bank, sometimes they operate them themselves and sell them down the road.
So tell me, is it that nationalizing banks is bad, or that nationalizing really big banks is bad?
The following banks were nationalized last Friday.
Pinnacle Bank, Beaverton, OR
Corn Belt Bank and Trust Company Pittsfield, IL
Riverside Bank of the Gulf Coast, Cape Coral, FL
Sherman County Bank, Loup City, NE
@Davebo – it's all about terminology and semantics. If we could all get along and call it what it is: receivership, conservatorship, restructuring, but with the federal gummint having the authority instead of a receiver or conservator. Republicans still own the name-factory (although the quality of its product has declined- “porkulus”? Really? ) See http://gregmankiw.blogspot.com/2009/02/national… for a good treatment of it.
“I don't know how to break it to you all (yet again), but we nationalize banks all the time. It's called the FDIC. “
Krugman broke this news [sic] to us already. Also, it verges into equivocation (out of a desire for euphemism, perhaps) to describe any and all federal involvement or oversight as “nationalization” rather than staying with the meaning of that word, which means here to change (and in practice, change compulsorily) from private to federal government ownership and control. (And ownership isn't really necessary, as has been known since the 1930s when trying to bend the private sector to the “public interest” [sic]. All that really matters is control.)
Nationalize the banks.'
Nationalize the oil industry.
Nationalize health care.
Hmmm how this so reminds me of the 1930's. The left sees a recession and they are in full panic throwing themselves out their fist story window. The right on the other hand is screaming for more tax cuts and ……and……….give me a minute and Ill think of something else they are screaming for……….
The message is…………….OH GAWD!! WERE ALL GONNA STARVE…….HEP ME< HEP ME.
Nationalize. Socialize.
The democrats remind me of Lloyd Bridges in Airplane as he screams and throws himself out of the tower window.
Throw money….more money…….we must throw money at it…………puhlease Obama make it go away……….take what you need, We will all be communists, just make the hard times go away.
“Nationalize…”
“Hmmm how this so reminds me of the 1930's. ” [and early Progressive Era, not to mention the Sixties]
Don't forget the nationalize-the-oil-companies howling after 1973 and 1979-80, and from Gus Hall all the time. (Presumably the lessons from just trying to implement a command and control scheme for energy, that failed, have not been learned — forward-thinking idealistic “energy policy” starry-eyed stuff is so much dreamer, after all — and perhaps banks are viewed differently by people than other elements of the private sector.)
So far there's no demand to “nationalize” the grocery stores as a brawnier part of otherwise-feel-good “food policy.” (That's where such views of government “policy” roles and objectives lead.)
Additonally why do you think Hillary Clinton is in Asia and most notably China at the very time this porkulus bridge to nowhere is being signed?
You got it…..hat in hand, begging the Chinese to PUHLEASE GIVE US MONEY>>>>>>PUHLEASE.
Hopefully she's telling the Chinese that next time the Obama team hopes to convince Congress to do a better job at legislating.