I Was Right
Like atrios, I was right.
Two weeks after persuading Congress to let it spend $700 billion to buy distressed securities tied to mortgages, the Bush administration has put that idea aside in favor of a new approach that would have the government inject capital directly into the nation’s banks — in effect, partially nationalizing the industry.
As recently as Sept. 23, senior officials had publicly derided proposals by Democrats to have the government take ownership stakes in banks.
The Treasury Department’s surprising turnaround on the issue of buying stock in banks, which has now become its primary focus, has raised questions about whether the administration squandered valuable time in trying to sell Congress on a plan that officials had failed to think through in advance.
A number of people told me that I was hysterical; that I didn’t know how the economy worked; that I have an irrational hatred for Wall Street; that I own nothing; that I was wrong; that the treasury HAD to do it this way or everything would collapse by Monday. Well, quite a few Mondays have come and gone, and when the market crashed repeatedly after the Paulson Plan 2 was cobbled together and passed by a bunch of panicked ninnies in Congress, it was telling that the very people shrieking that the sky was falling on Sunday September 21 were all of a sudden sanguine and largely dropped the subject as everything went boom.
I’m not going to pretend I’m some kind of genius or economic expert because I’m not. It’s called common sense: when someone you already know isn’t trustworthy makes an outrageous demand of you that must be met NOW NOW NOW NOW NOW, there is probably something else going on. And so I read articles by people who seemed to know what they were talking about. Dean Baker was helpful. So was Atrios, Paul Krugman, and Nouriel Roubini. I started getting into arguments with “people who know better” and kept finding that… well, they didn’t know so much after all. No one could ever tell me how the government was going to put an accurate price on these shitty assets, or how the taxpayers were going to get their money back. The explanations from the bailout supporters ranged from the arcane to “wait-and-see”. And now the government seems to have turned its back on its original plan. I wonder anyone will be sending me email apologizing for calling me a cynic and trafficking in hyperbole?
I hope the capital injection plan works. I need a loan too, for a new gas furnace for the house, and the seizure in the credit market is NOT helpful.
Today though I’m just glad to have been right about something, for once.
October 12th, 2008 at 11:56 am
[...] Read the rest of this great post here [...]
October 12th, 2008 at 11:56 am
The average citizen felt this happening two years ago. We knew you were right all along, we’re sailing with you in this same listing ship. *gonna need a puke bag soon though*
I have a feeling that the pressure (financial, political, racial, religious, irrational fear..) is building to a point of explosion. I may be freaking-out here, but I see the potential of violence breaking out in the streets. Public expression has been muted for so long now that it may be impossible to contain, and the result, I feel, will be bloody. All it needs is one incident to trigger it. I hope I’m wrong.