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View Diary: Jack Lew and the premature descent from heaven: A tale of the American nomenklatura (89 comments)

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  •  wouldn't it be nice (32+ / 0-)

    if liberal scholars such as krugman and stiglitz occassionally were taken seriously by the self-styled meritocracy. but krugman and stiglitz have had the bad fortune of being proven right about pretty much everything, this past decade. in other words, they are not qualified.

    The cold passion for truth hunts in no pack. -Robinson Jeffers

    by Laurence Lewis on Sun Jan 20, 2013 at 10:08:24 AM PST

    •  Krugman has said, (9+ / 0-)

      and I believe him, that he  does not want a government job.

      "A developed country is not where the poor have cars. It's where the rich use public transportation." - Mayor of Bogota

      by Time Waits for no Woman on Sun Jan 20, 2013 at 10:11:07 AM PST

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    •  James Galbraith, no right winger, gave an (6+ / 0-)

      interview with Huffpost a few days ago supporting Lew.  For what it is worth, in the old days they worked together on the Hill and Galbraith thinks Lew has progressive credentials.  I'm not so sure and things change, but it is worth considering.

      Suppose you were an idiot. And suppose you were a Republican. But I repeat myself. Harry Truman

      by ratcityreprobate on Sun Jan 20, 2013 at 10:39:42 AM PST

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    •  Obama's understanding of Keynesian economics (7+ / 0-)

      is so rudimentary and incomplete that there is no chance that someone like Stiglitz or Krugman would get any position in the administration or accept one.  Since they ran Christina Roemer off I would be surprised if any first tier economist would accept a position in the administration.  All they will get are business economists or other coulda bins.

      Suppose you were an idiot. And suppose you were a Republican. But I repeat myself. Harry Truman

      by ratcityreprobate on Sun Jan 20, 2013 at 10:48:10 AM PST

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      •  Keynesian economics? (10+ / 0-)

        This administration's policy is Hooverism with a thin sprinkling of tax raises on the rich to make it palatable to the electorate. It's about as far from Keynes as you can get.

        They are proposing to cut the budget in the midst of an economic crisis, and to cut the New Deal programs that were partly intended to help protect Americans against the impact of another Great Depression. It's like they want to go back to 1930.

        Have you noticed that in every single speech about the budget Obama insists that we've done no more than make a good start to deficit reduction, that we need to cut more? At a time of high unemployment!

        We have another Herbert Hoover in the WH, except people don't realize it because a) he's an amazing rhetorician and b) he belongs to a historically oppressed ethnic minority, so people assume he must be enlightened and progressive.

        Nothing of the kind! His economic policy is deeply reactionary.

        "In America, the law is king." --Thomas Paine

        by limpidglass on Sun Jan 20, 2013 at 11:27:41 AM PST

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        •  Yep. Hooverism aka Reaganomics. (3+ / 0-)
          Recommended by:
          xaxnar, PrahaPartizan, Chi

          Obama admin appoints neo-liberals to key economic posts.
          Reaganomics has been very good to them personally.
          Maybe they believe it's going to eventually work for the economy at large.  It won't.  30 years proves that.

          Carlos Fuentes explains how well it worked out in Latin America in "A New Time for Mexico":

          " Throughout the nineteenth century, Latin America followed the precepts of laissez-faire and the magic of the market… Powerful economic elites emerged from Mexico to Argentina. The hope was that the wealth accumulated at the top would sooner or later find its way down to the bottom. This did not happen. It has never happened. Instead, the wealth generated at the working base found its way to the top and stayed there.”

          Reaganomics in a nutshell.

          We need Keynesian economics, stimulus, not austerity.

        •  Hoover would never have proposed a stimulus (1+ / 0-)
          Recommended by:

          package like the one Obama promoted that was partially approved by Congress. The reasons that there hasn't been more has been

          1) Republican obstructionism, and
          2) Other goals, like health care and re-regulation of the financial sector, both of which were enacted

          The main reason that there hasn't been another Keynesian stimulus package is really because WE didn't turn out the vote in the 2010 general election, and the Rethugs took control of the House.

          •  All may very well have been the case (0+ / 0-)

            But what's needed is beyond Keynes

            e MMT unum
            Until progressives understand MMT, we stand no chance of convincing teaching anyone else, or accomplishing anything, anywhere, anytime.

            The only excuse at this point is that even Krugman doesn't really understand -- though he's making some incremental progress recently.

            United We Understand

            by dorkenergy on Mon Jan 21, 2013 at 06:38:22 PM PST

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      •  On Christy Roemer (4+ / 0-)

        I think Summers ran her out because she lacked the math gene.

        This aggression will not stand, man.

        by kaleidescope on Sun Jan 20, 2013 at 11:39:57 AM PST

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        •  More likely, she lacked the perverted (0+ / 0-)

          math gene that endemic to neoliberalism (where plus is minus).

          But an alternative version of the story on Christy Romer (proper sp.), in an article by William Black where he quotes from the WashingtonPost WonkBlog:

          From Zach Goldfarb’s excellent profile of Treasury Secretary Timothy Geithner’s success inside the Obama administration:
          The economic team went round and round. Geithner would hold his views close, but occasionally he would get frustrated. Once, as [then chairwoman of the Council of Economic Advisers Christina] Romer pressed for more stimulus spending, Geithner snapped. Stimulus, he told Romer, was ‘sugar,’ and its effect was fleeting. The administration, he urged, needed to focus on long-term economic growth, and the first step was reining in the debt.
          Wrong, Romer snapped back. Stimulus is an “antibiotic” for a sick economy, she told Geithner. ‘It’s not giving a child a lollipop.’

          In the end, Obama signed into law only a relatively modest $13 billion jobs p remarksrogram, much less than what was favored by Romer and many other economists in the administration.”

          William Black remarks:
          If Geithner had not helped block the push by Romer and Summers within the administration for greater stimulus the U.S. recovery would be far more robust and millions more Americans would be employed. (In fairness, the Republicans and conservative (“Blue Dog”) Democrats who killed the revenue sharing portion of the stimulus bill and insisted that much of the stimulus had to be in the form of the extension of tax cuts for the wealthy, which have a far smaller stimulus effect than alternatives, also cost millions of Americans their jobs.)

          United We Understand

          by dorkenergy on Mon Jan 21, 2013 at 07:08:11 PM PST

          [ Parent ]

          •  Thank You for this Response n/t (1+ / 0-)
            Recommended by:

            I actually learned something.

            This aggression will not stand, man.

            by kaleidescope on Fri Jan 25, 2013 at 10:09:52 AM PST

            [ Parent ]

            •  As one grasshopper to another (0+ / 0-)

              William Black is one of the leading proponents of "Modern Monetary Theory (MMT)".

              MMT is emerging as "a" (if not "the") key enabling tool for all progressive/dem goals (directly for those that require $; indirectly for the rest by removing distractions from the public discourse).

              If you're not familiar with it, I'd suggest exploring.

              For starters, there's a fun, quick, explanatory video, MMT for Dummiez. That site is a great centralized resource. One of the main contributors there is Joe Firestone. He cross-posts on dKos as Letsgetitdone.

              If you'd like more pointers, I can provide.

              United We Understand — e MMT unum

              by dorkenergy on Fri Jan 25, 2013 at 12:50:31 PM PST

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      •  Most likely, the President understands Keynes (3+ / 0-)

        Just fine.  As the leader of his class, he rejects it.  

        These are people who believe our only realistic course is to beggar the working class.  In short, the President is tasked as a member of, and leader of, the plutocracy to manage the current phase of the decline of the working class and the continuing consolidation of corporate rule.  His actions and associations are demonstrations of this principle.

        The President knows exactly what he's doing; I don't see how a person of such intelligence and education wouldn't know.  Like the rest of his class, he's convinced himself that his (and their) course is necessary and, however, painful for the rest of us, ultimately beneficial.

        The President's failure here is not one of understanding, but of morality and courage.

        Any significant cut to the social safety net ends my support for the Democratic party.

        by MrJayTee on Sun Jan 20, 2013 at 11:42:27 AM PST

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        •  Your hypothesis (0+ / 0-)
          Most likely, the President understands Keynes
          just fine.  As the leader of his class, he rejects it.
          is arguably correct.

          A more minimal assumption -- in line with some of the other comments here -- can be taken from the line I chose to  highlight in William Black's piece below, Jacob Lew: Another Brick in the Wall Street on the Potomac. (I include more here for consideration in the others. There's more there -- suggest a full read. But I want to focus on just that one line.)

          Lew's predecessor as chief of staff was William Daley. Daley is a lawyer. Daley was on the executive board of J.P. Morgan- Chase during the crisis and before that he was on Fannie Mae's board of directors. Daley is a member of "Third Way's" controlling board. Third Way is a Pete Peterson ally that lobbies in favor of austerity and cuts to the safety net. It pushes Wall Street's, and Pete Peterson's, greatest dream -- privatizing Social Security. Privatization would allow Wall Street to increase its profits by hundreds of billions of dollars in fees for managing our retirement savings.

          Daley's predecessor as Obama's chief of staff was Rahm Emanuel. Emanuel's degrees are in the liberal arts and communications. Clinton appointed him to Freddie Mac's board of directors during the period when the board was heavily criticized for its failure to prevent massive accounting abuses at Freddie Mac. Emanuel worked for Wasserstein Perella, the prominent investment banking firm.

          The obvious aspects of this pattern include: (1) Obama prefers to have Wall Street guys run finance (despite coming to power because Wall Street blew up the world), (2) the revolving door under Obama that connects Wall Street and the White House has been super-charged, and (3) even very short stints in Wall Street have made Obama's finance advisers wealthy.

          The unobvious aspects of the pattern compound these problems. First, Obama likes to surround himself with failures. Geithner set the pattern. He was supposed to be the principal regulator of most of the largest U.S. bank holding companies. He was an abject failure. His speeches and his statements at the Federal Reserve System's FOMC meetings during the crisis demonstrate that he remained clueless to the end. For reasons of brevity, I discuss only three of his failures as Treasury Secretary below.

          Lew has gone from failure to failure. He was one of the architects of both of the Clinton administration's disastrous statutory deregulatory actions that helped produce the epidemic of accounting control fraud that drove the Great Recession.

          The fourth non-obvious problem is that Obama chooses as his principal financial advisors people who have not been trained to have financial expertise. Geithner studied international politics. Emmanuel studied speech. Lew, Obama, and Daley studied law. Lew, Daley, Emanuel, and Geithner all worked in finance, but they did so because of politics and who they knew rather than what they knew. Competence was never the key.

          Given that, a way to state the more minimal hypothesis is
          Accepting that:

          1) Obama chooses as his principal financial advisors people who have not been trained to have financial expertise. (as highlighted above)

          2) The thoroughly discredited neoliberal school has dominated economics instruction for the past several decades

          3) Neither Obama, Lew, Geithner, nor Daley have been exposed -- in an academic context -- to a critique of neoliberalism sufficient to expose its mathematically perverse accounting.

          then Obama, Lew, Geithner, and Daley have simply been beguiled by the myths they (and the rest of us) have been exposed to and the propagators of those myths.

          The question is how should we direct our foci and resources given our assessments of likelihood of the two (minimal and maximal) hypotheses.

          e MMT unum United We Understand MMT

          by dorkenergy on Mon Jan 21, 2013 at 08:39:45 PM PST

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      •  Obama is a firm believer (5+ / 0-)

        in the Rubanite fundamentalist school of free/trade market. Who he appoints is a reflection of his economic ideology. There is nothing progressive about his approach to the economy. He made that quite clear in an early speech 2006 at the launching of the Hamilton Project.

        Geithner may not have worked for Goldman Sachs, Chase or Citi  but he was a facilitator for the bankster's. Any president that makes Immelt, the CEO of GE, job czar at a time like this isn't interested in an economy that is just or equitable. Quite the opposite. Clinton's 'inevitable' wealth creating NWO or as Axelrod said 'the world as we find it' is what this administration is about.

        The DLC on steroids,  The Third Way is the direction he's following. Why would he appoint anyone who reflected the New Deal, or any progressive economic policy and direction?

        'We do not disparage wealth creation in America'  Barack Obama

        Instead we are asked to share the sacrifice to keep the 'inevitable' vampire squid firmly implanted on humanities face. How delusional to think the savvy businesmen running our party and the government would appoint anything other then the people who are invested in and believe in  'The Theory and Implementation of Oligarchical Collectivism'.    

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