Monday, November 23, 2009

Ye Olde Split Between Top and MIddle

"Top" here means the White House and the Congressional leadership, whom Krugman describes as being pulled away from job creation and other recovery politics by the banks, who in a growing number of accounts have conquered the U.S. Government.   Max Keiser's "Goldman Sachs are scum . .. they've basically coopted the US Government, the US Treasury Department, the US Federal Reserve functionality, they've coopted Barack Obama" -the second part, about banker cooptation, apprears on the pages of many daily newspapers.

The middle - here rank-and-file Congressional Dems - rebelled a bit.  They passed a measure in the House Finance Committee requiring an audit of the Fed's many enormous bailouts of insolvent banks, whose sums and recipients remain undisclosed. They passed the measure over the opposition of House Finance Committee Chair Barney Frank.

There are lots of good ideas around about how to fix things.  One of many examples is Dean Baker's idea of how to actually go about revaluing the Chinese yuan. The problem isn't that nobody knows what to do, that it's all so complicated. The problem is that the top doesn't want to do the things that could be done to fix things.  These things would cost them money.  

The outcome is the sort of phony helplessness that now pervades US policy in finance, job creation, higher education - take your pick.  It only works on the assumption that most of us are pretty dumb.

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