Tuesday, February 10, 2009

Economic Quote of the Day: From NYT

February 10, 2009 7:14 am

Geithner's efforts are all well and good but one has to keep perspective on the possible best case scenario. What does an "unfrozen" credit market even look like now? The reason for this catastrophe was that banks made irresponsible loans to both irresponsible and simply ill-equipped borrowers. These "toxic" assets didn't just appear. They are the result of our entire economy living on bad credit from billion dollar investment banks to individuals. We have no idea what the American economy would look like with responsible credit practices.

Surely it's an improvement over no credit but the credit markets alone don't explain what was fundamentally wrong with the economy in the first place. While Bill Clinton offered some push-back, there has essentially been a systematic dismantling of the public sector since Reagan took office with the direct effect of eviscerating the middle class and creating a canyon between the wealthy and everyone else in our society. Public college now costs the same as private college did just 15 years ago. These are the core issues that Republicans claim as wasteful spending in the stimulus that actually provide the only real hope of redemption. Obama’s true charge is to rebuild both the middle class and the public sector all over this country. Frankly, Obama may not be a Messiah but it's starting to look like "Messiah" might be the easier job.

Republicans are right to quibble with the semantics of "stimulus". This is not a stimulus. It is a massive re-prioritization. This is turning an air craft carrier away from a tsunami. It's time for Obama and the Senate to play hardball and find the one or two Republicans needed to pass the kind of bill that will actually save us. Build a naval base in Wyoming if we have to. Just get it done.

— Pier Giacalone, Doylestown, PA

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