01/20/09: Obama's bailout plan: an indefensible departure from the economically efficient savings and loan rescue.
Posted by: John
http://www.nytimes.com/2009/01/19/opinion/19krugman.html
Under Obama's plan Wall Street will continue to dictate financial policy for its own enrichment. The only way to stop Wall Street from stealing from Main Street is to establish rules (1) preventing executives from financial firms like Goldman Sachs leaving their firms to become powerful financial policymakers such as Secretary of the Treasury, and (2) preventing powerful financial policymakers from taking prestigious jobs on Wall Street immediately after leaving the government. The rules should establish a cooling off period between high level employment in financial firms and government employment involving economic policy. Obama can establish such administrative rules without congressional approval. Once rules are enacted to minimize the conflicts of interest, Wall Street's grip on financial policy will loosen. Only then will economic policies benefit the economy.
Under Obama's plan Wall Street will continue to dictate financial policy for its own enrichment. The only way to stop Wall Street from stealing from Main Street is to establish rules (1) preventing executives from financial firms like Goldman Sachs leaving their firms to become powerful financial policymakers such as Secretary of the Treasury, and (2) preventing powerful financial policymakers from taking prestigious jobs on Wall Street immediately after leaving the government. The rules should establish a cooling off period between high level employment in financial firms and government employment involving economic policy. Obama can establish such administrative rules without congressional approval. Once rules are enacted to minimize the conflicts of interest, Wall Street's grip on financial policy will loosen. Only then will economic policies benefit the economy.
John II wrote: