Paul Krugman is frequently quoted here in this nanocorner of the ‘Sphere©, because he so frequently cuts through the obfuscation and clarifies economic realities. (See this post, and this one, for example.)
Today, the George III administration announced with great fanfare their latest financial system reforms.
Krugman looked it over. His conclusion: There’s no there, there.
The Dilbert Strategy
By PAUL KRUGMAN | Published: March 31, 2008
Anyone who has worked in a large organization — or, for that matter, reads the comic strip “Dilbert” — is familiar with the “org chart” strategy. To hide their lack of any actual ideas about what to do, managers sometimes make a big show of rearranging the boxes and lines that say who reports to whom.
You now understand the principle behind the Bush administration’s new proposal for financial reform, which will be formally announced today: it’s all about creating the appearance of responding to the current crisis, without actually doing anything substantive.
The financial events of the last seven months, and especially the past few weeks, have convinced all but a few diehards that the U.S. financial system needs major reform. Otherwise, we’ll lurch from crisis to crisis — and the crises will get bigger and bigger.
Did you really believe the guys who put the “lazy” into laissez faire capitalism” were really going to propose anything substantive, or even mildly helpful?
Nope, it’s all cosmetic, friends.
So, 34,000 workers on Wall Street have lost their jobs in the past nine months, but the partners and bosses of their former firms cashed out months ago, and have retired to upscale golf courses not near you.
So, people who thought they had finally bought a piece of the American dream are fleeing those homesteads just ahead of the sheriff, while the ghouls fly back from their Caribbean hideaways to buy up distressed real estate at pennies on the dollar, laying down the foundation for their next fortune.
Read somewhere that some lenders are quietly offering bounty payments (up to several thousand dollars) to foreclosed property (ex-) owners, so that they leave quietly, without doing what a significant minority are evidently doing, trashing the place on their way out.
So, the dollar’s in the toilet, sending the prices of luxury goods, such as gasoline and food, up, up, up.
Doesn’t bother those denizens of the golf courses, nor their minions in Washington, who just threw up another coating of obfuscation, pretending to do something while really not giving a damn about the other 99.6% of their fellow citizens.
[Please click the link below for the complete article — but then please come on back!]
Are you finally angry? It’s about time.
In fact, as this is written, it’s only 296 days until a new administration takes over, and cleans house.
I hope we can wait that long.
It’s it for now. Thanks,
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