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20 January 2009


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zanzibar -

The Geithner lapse bothers me too. Because it seems part and parcel of the culture of opportunistic self-serving on Wall Street that sunk us deep in the present economic morass. Does it matter how well he understands the problems? He may have been too smart by half already.

I would be willing to give him the benefit of the doubt that his original failure to pay was an oversight - though one is not reassured when a top banker seems not to recall the basic social security tax requirements that every independent consultant knows.

But here is the rub, as I understand it. Apparently, when the IRS caught up with Geithner, two years of missed payments had passed the statute of limitations. So he was not required to pay those taxes. And he chose not to do so. This was a choice, not an oversight. Until the Obama review caught it.

In other words, Geithner had no intention of ever paying those taxes. He had gotten away with it. And unlike most of us, who do not occupy powerful positions, the gentlemen of the IRS gave Geithner a bye on penalties too.

Playing the dark side of the law. Taking whatever profits you can get away with. And privileged treatment for the privileged from the law enforcers. Not the model one would think that President Obama wants at the head of the great money forge.

Or is this a case of it taking a thief to catch thieves? So to speak.


Hail to the Chief Indeed!


Hail to the Chief Indeed!


Watching the Inaugural Address, I said to my partner, this must be uncomfortable for W. My partner replied that the criticisms probably went over W's head. Today we read in the NY Times that "Some on the Bush team" regarded the speech as ungracious.

That the Bush team values good manners above all else is no revelation. What the speech revealed about the new president was more important. Obama is very gifted at raising emotion in others, but also very skilled at keeping his own emotions and feelings under wraps.

Here is the passage that I think most got under the Bush acolytes' skin: "Our economy is badly weakened, a consequence of greed and irresponsibility on the part of some, but also our collective failure to make hard choices and prepare the nation for a new age."

Both on the page and in the (televised) flesh, I see these words as an expression of anger barely suppressed. He is judging Bush on what were supposedly Bush's own terms: responsibility. He's judging Bush based on an objective criterion: the state of our nation's economic health. We're in deep trouble and Obama's anger is justified.

When W took office the Federal Government was in surplus. Whatever criticisms you may have of Bill Clinton, he took over a government with a deficit at the the time of historic proportions.

Bill Clinton did not give a speech similar to Obama's, in large part because GWHB's administration had been much more responsible than that of his son's. Our adventure in Iraq in the 1990's was limited, it was paid for by our allies and it did not damage either our armed forces or the national interest. Bill Clinton mostly maintained the GWHB status quo, protected the Kurds while they worked things out and used our assets to keep Saddam in check, probably more successfully than even Clinton realized.

The huge deficits of the early 1990s were not a result of GHWB's profligacy. Instead, they were lower than they otherwise had been because he cleaned up the savings & loan mess bqueathed him by Reagan. He raised taxes to do it. This cost him dearly among the Republican base and was a key factor in giving Clinton the election.

Brad DeLong quotes John Stuart Mill "Lord, enlighten thou our enemies. Sharpen their wits, give acuteness to their perceptions, and consecutiveness and clearness to their reasoning powers: we are in danger from their folly, not from their wisdom; their weakness is what fills us with apprehension, not their strength...'

Right now, I think we should all be praying that the Republicans become enlightened. It was not Republican policy in 1991 to engage in war without preparation; how did it become Republican policy in 2003? It was not Republican policy under GHWB that "deficits don't matter." How did it become Republican policy in 2001?

Obama gives all appearances of being a credible, serious, intelligent president. The more he is president, the more he will need an opponent that has at least some intellectual credibility. At the present state, that is more likely to come from the Democratic party than the Republican. We should all be angry.


Dies ist ein großer Ort. Ich möchte hier noch einmal.

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