Originally Posted by jbolson
First, I'm not an Obama lover. But I think there are two issues at hand - undoing the financial mess and preventing it from happening again. I don't think they are the same whatsoever. The current priority is to undo the mess. These guys might be the best to do it since they have inside knowledge of the problems. However, I don't think they are the ones to prevent it from happening again (i.e., increasing regulation).
The reason these guys have "inside knowledge of the problems" is because THEY CREATED THE PROBLEMS!
It is the classic story of the fox guarding the hen house.
And, the other classic story in regards to many Americans is:
Have you ever wondered why these bankers are only focusing on the symptoms and not focusing on the problems? Maybe it's because it would put the spotlight on their complicity in creating the mess and would expose their utter incompetence and corruption - for those who might believe in the corruption possibility.
There are plenty of other economists and advocates who have plenty of enough expertise to help solve the problems. There are better solutions... it is just so rare to hear about them in the corporate media.
Ralph Nader recently said that the gov't could have used the trillions in bailout money to create 10 new banks with $35 billion each with a 10 to 1 leverage to open the credit markets. There is a temporary solution.
Invester Jim Rogers said,
"They call up and shriek about systemic risk. Come on. Investment banks have been going bankrupt for hundreds of years and the world has still somehow survived. This approach has never worked. This is what the Japanese did in the 1990s. They refused to let anyone fail. And they had zombie banks and zombie companies. The way the system is supposed to work is when we have bad times, the assets moves from the incompetent to the competent, and then the competent start with renewed strength and the system rebuilds itself."
Economist Dean Baker has written extensively on the AIG scandal
and also gave a solution to the bonus scandals
He said that since the gov't owns 80% of AIG it could split off the financial division and allow it to go bankrupt.
Nobel Prize Laurette Joseph Stiglitz has also written about better solutions
. Even recently he wrote about how Geithners new plan is a win-win-lose
. Guess who loses?
Economist Simon Johnson recently wrote an article that should be read by everybody. Helio posted it on another thread, but here is the link again
. He mentioned that we need to be nationalizing and breaking up the mega-banks.... the EXACT opposite of what the guys with "inside knowledge" are doing.
Other intellectuals have talked about how the financial logic of neo-liberalism has failed and has reached it's limits. Here's a good one.
The misnamed "Group of Twenty" (G20) meets in London on 2 April 2009 to discuss how to save the global financial system. It is too late. The evidence is in: we don't have the resources to save this system - even if we wanted to. It has become too big to save: the value of global financial assets is several times the size of global gross national product (GDP). The real challenge is not to save this system but to definancialize our economies, as a prelude to move beyond the current model of capitalism. Why should the value of financial assets stay at almost four times the overall GDP of the European Union, and even more of the United States. What do everyday citizens - or the planet - gain from such excess?
The question answers itself. To explore further the inner workings of the financial system that has brought the world to this predicament is also to glimpse a future beyond financialization. The task the G20 should actually address is not to save this financial system but to begin to definancialize the major economies to a significant degree, so that the world can begin to move towardsthe creation of a "real" economy that delivers security, stability, and sustainability. There is much work to do.
We cannot begin this new work to rebuild until we face the fact that Obama's economic appointees NEED TO BE KICKED OUT AND REPLACED!!!
"We cannot solve our problems with the same thinking we used when we created them