HBS Working Knowledg just came in yesterday and has a very long, interesting look at the crisis and the plan in Financial Crisis Caution Urged by Faculty Panel:
"Harvard Business School faculty members, looking at the U.S. financial crisis from a variety of disciplines, urged caution and prudent analysis in a recent panel discussion.Today's Washington Post has an alternative (The Trickle-Up Bailout) which appeals to me and Michael Gerson examines the political failure that was Monday in Too Small for a Big Crisis. David Brooks did his criticizing in Revolt of the Nihilists and I generally prefer Brooks to Gerson, but this paragraph from Gerson is too interesting not to point out:
The discussion titled 'Turmoil on the Street: Fathoming the Financial Crisis' was held September 23."
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"My concern right now is that although there's an enormous amount of discussion about the $700 billion, the discussion may not be sufficiently sensitive to the need for reasonable oversight of the financial system. To be sure, there's been a lot of discussion about oversight of Secretary Paulson, and that's a compelling objective. But we haven't seen nearly as much discussion about what this bailout means in terms of the oversight of financial institutions that will be required. We have to be serious and smart about this. If we don’t structure it correctly, the bailout could very well calm the current crisis, but also provoke even greater – and even more dangerous – risk-taking in the future,” said Moss.
But whatever their provocations, pressures and justifications, House Republicans once again revealed the souls of backbenchers -- spouting their ideological purity from atop the ruins of the financial system. The temporary government purchase of bad mortgage debt is not equivalent to the liquidation of the kulaks. Serious conservative thinkers such as Ryan and Cantor, who chose to work within the legislative process, got many of the improvements they sought. But most House Republicans with ideological objections had nothing better to propose and no intention to try. They chose allegiance to abstract principles over practical reality. It is the political philosophy of Samson: Bring down the entire temple to make a political point. In this case, the president, their own congressional leadership, their own presidential candidate and the world economy are now wounded and struggling amid the rubble. I suppose the point is made. But it is a reminder of why Republicans are no longer trusted as the congressional majority.Thomas Friedman's Rescue the Rescue makes clear how this does affect all us all:
One of my wife's sisters works for A.I.G. and her job is in doubt. I am happy to see Obama doing a bit more to explain what is going on. Here is another point in his favor: he knows when to shut up and let others do their jobs:Well, you say, “I don’t own any stocks — let those greedy monsters on Wall Street suffer.” You may not own any stocks, but your pension fund owned some Lehman Brothers commercial paper and your regional bank held subprime mortgage bonds, which is why you were able refinance your house two years ago. And your local airport was insured by A.I.G., and your local municipality sold municipal bonds on Wall Street to finance your street’s new sewer system, and your local car company depended on the credit markets to finance your auto loan — and now that the credit market has dried up, Wachovia bank went bust and your neighbor lost her secretarial job there.
I am learning a lot from Paul Krugman's blog. Even for those who do not like his politics (which is not me), can learn some economics there."You'll recall that when Sen. McCain suggested he would suspend his campaign and we would go to Washington, it created sort of a flurry of media," he said. "But, what we didn't see is the kind of focus on just getting the job done that was necessary. That's why I've deliberately tried to stay behind the scenes in the work that I have done."
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