Damn. If I could get a deal like that… but then, I’m middle class.

I’ve been thinking for a long while that one of these guys really ought to crash and burn to make the point. Maybe Paulson’s been thinking the same way. I mean, this is going to hurt BAD in the short term, but if we keep bailing the children out, they won’t learn from their mistakes.

I’m having a crash-course (ouch; sorry) in economics this week. From what I gather, we’re reaping the whirlwind that was sown as far back as the second Reagan term. Probably, any other president but Dubya would have seen the warning signs of a meltdown 18 months ago. Looks to me like there isn’t much they can do now that will please anyone. Acts of desperation rarely do.

If we say this started “before Bush II”, and that means the Clinton administration, we’re assigning blame badly. The campaign to kill Glass-Steagall started under Bush I. Or before, but I don’t think it amounted to anything that early. Definitely the bankers were working to kill that inconvenient law for years, and maybe there’s something positive in the fact that it took as long as it did.

One hates to defend high finance *and* a Bush appointee at the same time, but maybe this makes sense in finance terms — and Paulson seems to have markings of competence that make you wonder how he sneaked into office. Anyway, a couple of possible reasons for being there:

One, it would be reasonable to try to help the various interests to get to a good solution. He was in a position to offer advice and mediation, and actual support if a good arrangement was in the offing, even without unlimited taxpayer dollars. No go, but worth trying.

Also, he probably had to be there precisely so he could keep saying NO with credibility. Any underling (or none at all, so they’d have to phone him up if they had a bright idea) wouldn’t carry enough weight, and they’d still go over the head to Paulson. Or, FSM forbid, to Bush! And in the process they’d have wasted time pursuing the idea, whereas Paulson could quash it on the spot.

Maybe the gummint ought to have backed the bad securities to stave off a worse crisis. Krugman seems to think so, or at least take it seriously. I sure don’t know. But the question has to come up, where do you stop? It’s possible Paulson was right in his choice.

BTW give him and Bernanke credit for one thing: They really, truly did not want to bail out the owners of these companies, who by all capitalist logic are supposed to take the loss when their enterprise runs itself into the ground. I mean capitalist logic, not crony capitalist shit that the Bush administration, and fortune, is based on. And it’s a good principle if you’re going to have capitalism at all.

Not taking a stand on that last “if”.

Just y’all were wondering about that cute “Funky Town” commercial during Hardball and Count Down.
Kazakhstan, Niger, and Canada, oh my…….

I heard something interesting on NPR on the short drive home. This weekend, Henry Paulson sat in hour after hour of meetings, while various parties pleaded and eventually flat-out begged Treasury to step in and save Lehman Bros– the same way they’d saved Fannie & Freddie, and Bear Stearns– and he just folded his arms, hour after hour, and said, “No.” Paulson offered no explanation of this inconsistency (which might have been easy enough to do; I can’t say), after which an institution that had survived the Civil War and the Great Depression succumbed to Stage IV terminal Reaganomics.

Jeez… if he never intended to say yes, why didn’t he just go golfing?

I also learned from NPR that Lehman Bros functioned as an “insurer” of sorts for the investments of other institutions, so it’s kind of like American Family suddenly going under in the middle of hail, wind & lightning season.

On a personal note, if my 401k evaporates, there goes my escape route to Canada in the event Palin-McCain win.