Fellow Lib Krugman Cracks Geithner

WedNEWSday - March 25th, 2009

Treasury Secretary Timothy Franz Geithner has been circling the drain as the world’s best business and financial minds are second guessing his every move, and rightfully so. The Public-Private Investment Program, which he provided some detail on earlier this week, is nothing more than the removal of “toxic assets” from banks’ balance sheets that will, becauase of pressure to sell by regulators, require huge “write-offs.”  These “write-offs” or losses will undoubtedly fall back on U.S. taxpayers.  Can you say bailout (again)?

Even fellow liberals on the left, economist Paul Krugman for one, are beginning to give the Obama administration and Geithner sharp tongue lashings.  In an interview with ABC News, Krugman offers the following poignant analysis:

“For people who felt that Obama was going to bring change, a real difference, it somehow feels quite a lot as if we’ve got the same old gang still making the policy decisions, despite how discredited they are in the eyes of the public,” said Krugman, who is a professor of economics and international affairs at Princeton University, a columnist for the New York Times and an ABC News consultant. “We’re going to create very sweet deals for people who will buy this stuff off the banks and we’re going to hope that just by creating this market, we make the banks’ problems go away,” he told ABC News. “It’s just very hard to believe that that’s all right. It’s quite likely to cost taxpayers $100 [billion], $200 billion in losses by the time it’s all said and done without actually reconciling the problems of the banks. Asked specifically how he thinks Geithner is doing, Krugman said, “I think not so good.”

While it’s refreshing to see liberals “cracking” one another, LewRockwell.com’s Bill Anderson explains that Krugman is right to oppose the plan, but in the same way a broken clock is right twice a day.  Anderson asserts that it isn’t so much Krugman’s concern for taxpayers as it is for his disdain for the free-market system, citing the following Krugman comment that appeared in his (Krugman’s) New York Times opinion piece on March 23rd (appearing below).

It’s a bit disappointing to see the Obama administration engaging in this sort of market-worship — hailing markets as a Good Thing in themselves, rather than as an often but not always useful means to an end. But I have reason to think that unlike the Bushies, they don’t really believe it; it’s just politics. Which is actually better than having genuine market fanatics running things, I guess.

This from ABC News - March 25th, 2009

http://abcnews.go.com/Business/Economy/story?id=7161203&page=1

This from LewRockwell.com - March 25th, 2009

http://www.lewrockwell.com/blog/lewrw/archives/026011.html

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