The Question Mr. Krugman is Whether We Can Get What We Want "Right Now!"

Hillary Clinton

Then Senator Clinton as she appeared last year at the SEIU confab with major Democratic candidates

Senator Clinton and Barack Obama were locked in a heated battle for the Democrative nomination. Paul Krugman backed the former first lady.

Picture adapted and used via Creative Commons license(attribution).  Thanks to "SEIU International"at Flickr.com.  No further contribution, acknowledgment, or support for this blog is implied.  Click on picture for full size original.  Rollover for further attribution.

Paul Krugman patiently explains once again how the Congress and the Clinton and Bush administrations screwed Americans by the promotion and approval of the passage of the Graham, Leach, Bliley Act in 1999 and later actions that decreased controls on banks and financial institutions.

I'm including Clinton because his Treasury secretary and even the former president himself pushed for the GLB Act.  The legislation put the last nail in the Glass-Steagall act from the Roosevelt era which prohibited the creation of complex financial institutions. The act passed in the fall of 1999, and the motivation for Clinton's support might have been that Hillary announced her intention to run for the New York Senate seat within a few months of the signing of the bill by her husband.  As we now know, New York and Wall Street are horse and carriage.  Looking up the vote on the bill (as I did during the campaign last year), I did notice that the Congressional vote on GLB was vetoproof, but still it can be laid at Clinton's door since he worked for it's passage. 

Another controversial measure, often called the Enron amendment was approved by Congress and signed by Bill Clinton in December 2000.  It's not really his fault though as he vetoed a version as a stand alone bill in October 2000.  It was put into the end of the year (and end of Clinton's term) must sign appropriations bill.

That Republican baby helped lead to excesses that were even showing through the cracks in 2002.  Remember the stock market started sliding because business executives were seen to be sucking the value out of their companies leaving little to nothing for other investors.  It wasn't just Enron. 

We had a stock market meltdown at that time too.  People forget under the propaganda barrage from the Republicans that Bush's "short and mild" recession  was worrying economists from 2001- early 2003.  In January 2003 financial writers were seriously worrying about 'deflation' just about 2 years after Bush's recession started.

A new war helped suck up some of the unemployed especially since many of the currently otherwise employed National Guard were sent as a first line, not a last line defense of our nation (in which most of us stayed back 5000 miles and went on with life). 

War spending, low interest rates, and sub-prime home loans 'ended' that recession (if phony money can be said to be a cure for anything) even as it set us up for this later downturn.  Bush also signed a bill that made stock dividends tax free in 2003.  Now what is it that is reported every night on every full fledged newscast, everywhere?  Why stock market numbers, right?  Bush had just given millions of people an incentive to stash money into the Stock Market to get a tax break (though if they left it in long enough they lost it all last year anyway).

 Also, though the Bush administration promised to fix things by letting Wall Street police itself instead of actually beefing up the SEC enforcement tools and capabilities.

Many liberal critics complained about that.  I can't be sure I read a Krugman column on the looming disaster.  I can't remember which years the NY Times chose to hide his column behind a subscription firewall. There are very good liberal columnists at the Washington Post too.

My point is that now we have the Obama administration promising a real system of regulation of Wall Street.  After Krugman's earlier column, I was waiting for his new one to emerge post Geithner announcement and I seem to see a his March 23 collumn rewritten as if new words would give his arguments more power to persuade.

And the acknowledgement of Geithner's reregulation program is contained in one sentence?

I know that hyper liberalism is fashionable today.  It kept Al Gore out of the presidency when combined with good old fashioned vote supression and judicial criminality at that time.  And it's the backbone of coolness on the left.  Our presidents are never lefty enough for us, we sigh like jilted 19th century belles and then faint onto the nearby sofa.

But can we please get back to reality?

Lets examine a few facts:

We do not have the mega money that the right has to fight our cause.  Our millionaires  cannot match the money of big businesses and banks and their top employees stream to right wing candidates, the RNC and support groups, or even without examination of economic reward to purchase ads on talk shows by Rush Limbaugh and other right wing hosts.

You may have noticed that besides your paper and a few others, liberal columnists do not actually get as much space as right wing ones.  That is likely the result of the big money following right wing ideology as mentioned above.

Therefore, Democrats are usually constrained in the real world the rest of us live in to baby steps.  

Theses baby steps become much harder when strong idealistic heavy hitters can't let go of their most extreme demands and turn other liberals against Democrats.

Also a second term in which presidents often feel more capable to dig into their idealistic bag of tricks and really make change is much more difficult to win while being battered by 'our own people'.  If Michele doesn't want to become the Senator for the "Great State of New York" we could have a chance at more liberal change in financial regulations in year 5-8 if our liberal editorialists haven't depressed Democrats into a half hearted political fight which could give the presidency and the Congress back to the War Party.

So, Mr. K. why don't you drop the  Veruca Salt "I want it NOW!" act over Obama and Geithner and help us.

And I won't mention that just about 1 year ago today you were telling us Democrats that the only one we should be voting for in primaries was Hillary Clinton whose husband was likely to be a big influence on any tenure in the White House she might have won.  That would be Bill Clinton, you know the president who pushed to have Graham, Leach, Bliley passed. 

 Deal?

Krugman's column from March 26, 2009

Hat tip Badtux the Snarky Penguin who covered the column from another angle.

tags: paul krugman  graham leach bliley  clinton  obama  geithner  

links: digg this    del.icio.us    technorati    reddit