Money
Do As We Say, Not As We Do
World leaders, apparently, are totally pissed that the US is bailing out its own banking system. This, after the US (via the Chicago School) has spent decades telling other countries (especially Third World countries) to not subsidize their failing economies, to let banks fail and markets go bananas, in order to instill market discipline.
First, let your banks go against the wall, they said, and then we’ll give you some aid.
Now that the US is ignoring its own advice, world leaders are carpe-ing the diem and wondering aloud whether the US hasn’t been wrong about free-market discipline all along.
The secretary general of the UN, Ban Ki Moon:
“The global financial crisis endangers all our work… We need a new understanding on business ethics and governance, with more compassion and less uncritical faith in the ‘magic’ of markets.”
The president of France:
President Nicolas Sarkozy of France described the crisis as the worst financial mess since the Depression and the financial system as “insane.”
The president of Brazil:
“We must not allow the burden of the boundless greed of a few to be shouldered by all,” President Luiz Inácio Lula da Silva of Brazil said in an opening speech Tuesday that reflected the tone of the [UN] gathering.
The minister from Britain politely noted that the US bailing itself out would be in everyone’s best interest—but the rest of the world is hopping mad.
Bungling in Iraq, bungling our economy, and North Korea giving us the finger by restarting its weapons program and barring inspectors—the US is losing leverage by the day.
Comments (8)
Yeah, well, the US is not some monolithic entity. I never said that the free market would solve everything, it was politicians and bureaucrats I didn't vote for who said that.
Posted by Greg | September 24, 2008 11:15 AMThird World countries that rejected structural adjustment programs have been doing better than those that caved. Says a lot about how much those motherfuckers know about economics, or how much they're willing to lie about it.
Posted by keshmeshi | September 24, 2008 11:19 AMIf they're too big to fail, then you're going to have to regulate them. Further, if the US is going socialist, then take control of the companies and do market controls (salary caps). The idea that the companies would get to choose which assets to pawn off to the govt from their balance sheets is lunacy.
Posted by left coast | September 24, 2008 11:27 AMWe can only hope that this turns out to be a spirtual market correction and leads to some new economic theories that don't always put capital before people.
Posted by inkweary | September 24, 2008 11:28 AMWe can only hope that this turns out to be a spirtual market correction and leads to some new economic theories that don't always put capital before people.
Posted by inkweary | September 24, 2008 11:29 AMAs long as the world economy is intimately married to the performance of the US economy, then it is in everyone's interest to keep it afloat.
On the other hand, we preach to developing countries not to subsidize their banks because we are trying to maximize our profits and reduce our risks.
There is no comparison between the global impact of the US economy collapsing versus, say, Zimbabwe's or, even, France's (sorry, France).
Posted by Mahtli69 | September 24, 2008 11:32 AMThe US consumer is the engine of the global economy. While it pisses me off that the Fed bails out bankers and lets people lose their homes, we have no choice.
Posted by gk | September 24, 2008 11:54 AMthe bailout is bullshit and illegal.
Posted by michael strangeways | September 24, 2008 12:00 PMComments Closed
Comments are closed on this post.