A world turned upside down

Strange times, maybe desperate times, when a conservative like me has to admit that left-wingers like Krugman and Joan Walsh make more sense than the typical right-wing pundit.

Paul Krugman:

Indeed, these days America is looking like the Bernie Madoff of economies: for many years it was held in respect, even awe, but it turns out to have been a fraud all along.

It’s painful now to read a lecture that Mr. Summers gave in early 2000, as the economic crisis of the 1990s was winding down. Discussing the causes of that crisis, Mr. Summers pointed to things that the crisis countries lacked — and that, by implication, the United States had. These things included “well-capitalized and supervised banks” and reliable, transparent corporate accounting. Oh well.

One of the analysts Mr. Summers cited in that lecture, by the way, was the economist Simon Johnson. In an article in the current issue of The Atlantic, Mr. Johnson, who served as the chief economist at the I.M.F. and is now a professor at M.I.T., declares that America’s current difficulties are “shockingly reminiscent” of crises in places like Russia and Argentina — including the key role played by crony capitalists.

In America as in the third world, he writes, “elite business interests — financiers, in the case of the U.S. — played a central role in creating the crisis, making ever-larger gambles, with the implicit backing of the government, until the inevitable collapse. More alarming, they are now using their influence to prevent precisely the sorts of reforms that are needed, and fast, to pull the economy out of its nosedive.”

Joan Walsh in Salon:

The article confirmed a feeling I've had for a while, that the Democrats can't get us out from under this mess until they are forced to reckon with their role in creating it. Every time I see Chuck Schumer on television pretending to be a populist scourge of Wall Street, I remember his role in blocking higher taxes for hedge fund managers and repealing Glass-Steagall. I can't help thinking that Tim Geithner is too close to the industry that took over -- and took down -- the economy to tame it. A large part of the Democrats' resurgence in the last four years, ironically, has been its success raising money from Wall Street, which undermines its populist street cred at a time like this. Fortunately for the party, Republicans are just as compromised, so it's not too late to for Democrats to take leadership in bucking the financial oligarchy and develop real solutions to the financial crisis.

On the right there is a curious silence about the crony capitalism that created this mess. Instead we get Randian wet dreams about "Going Galt", and endless quotes from "The Road to Serfdom."

I can't say i disagree with Armed Liberal:

But - what I'm seeing in this rising tide of conservative confidence is relatively stupid chestbeating.