|
|
Bailout Politics
More than a few American politicians are spending the holidays plotting how best to take advantage of the U.S.-orchestrated IMF bailouts in Asia, and at the slightest sign of slip will be ready to toss a helpful banana peel.
Here follows a decoding device: a means to detect the pols and pundits who are trying to profiteer on Asian trouble, and to separate them from those making a statesmanlike effort to avoid a Millenium Depression (there are a few statesmen left; and I mean no scaremongering: absent the U.S. and IMF efforts these last few months, a depression is exactly what we would get).
The bailout-opposing profiteers come in two distinct packages. They are the usual suspects from left and right political wings, but whenever high finance is the issue, they take considerable pains at camouflage, and act in peculiar concord.
The left-leaning group is descended from the agrarian, egalitarian, anti-market, anti-bank, anti-money Populists of roughly 1880-1925 vintage. Many today fancy themselves "Progressives" (anything to avoid the L-word).
At the opposite end, the right-leaning bunch would be comfortable at dinner with any turn of the century Robber Baron, the Populists' arch-enemies. Today's laissez-faire equivalents have no handy tag: all are Republicans, but so are most bailout proponents. Modern free marketeers should be known by their automatic advice for any person, family, corporation, or nation in financial distress: "Pull the plug!" So, Plugpullers they shall be.
How do you tell one from the other, and the two from statesmen?
Code words and fellow travelers.
Any mention of a "heavy-handed" or "misguided" IMF, or suggestion that excess production capacity should be solved by higher wages, and you're certain to have a Progressive on your hands. Last week, Molly Ivins ended a piece titled "How to Save the Global Economy" with "Éthere is a better way to do this -- by stimulating growth and wages while nations clean up their bad debts." It's a very old, sure fire Progressive prescription, in camouflage: print money and raise taxes.
Tip-off Progressive quotables and pols: William Greider (great reporter, bad thinker), Lester Thurow ("Zero Sum Society" author, mercifully cloistered at MIT), Jeffrey Sachs (late savior of the Russian economy, returned to Harvard); Dick Gebhardt, Paul Wellstone.
The Plugpullers are more pernicious, if only because there are more of them, for the time being.
Code phrases: markets must be free from any "governmental intervention"; and unwise investors must always "pay the price" of error.
Tip-off source: anything from the Wall Street Journal. Last week: "Are governments like firefighters putting out a blaze even thought the property owner foolishly failed to install sprinklers?" Pols: Jack Kemp, Steve Forbes.
The Progressives despise the inconvenient honesty of markets, believe that water can and should be made to run uphill, and that anyone advocating downhill flow in spite of instructions should be gagged. In equally deep error, the Plugpullers' list of vile interventions includes the Securities and Exchange Commission, the Financial Accounting Standards Board, Bankruptcy Court, the Fed, Social Security, and Lord knows, the IMF.
How much damage can the Progressives and Plugpullers do? They have already conspired to block new funding for the IMF (the Progressives wanted to export American environmental and labor law; the Plugpullers predictably refused any compromise). At the slightest sign that "taxpayer dollars" or "U.S. guarantees" are under discussion -- which may well be necessary if the Japan domino begins to wobble -- look out.
This weird concert of left and right can paralyze the good guys -- Treasury Secretary Robert Rubin in public lead, Alan Greenspan in private charge -- at the worst possible moment.
|
