Eye Off The Housing Crisis Ball

Atrios and Krugman point favorably to this Christine Romer speech (PDF):

My main criticism is that they took their eye off the ball in late 2009 and 2010. [. . .]Like the Federal Reserve, the Administration and Congress should have done more in the fall of 2009 and early 2010 to aid the recovery. I remember that fall of 2009 as a very frustrating one. It was very clear to me that the economy was still struggling, but the will to do more to help it had died. There was a definite split among the economics team about whether we should push for more fiscal stimulus, or switch our focus to the deficit.

I'm not a Nobel prizing winning economist but I find Romer's arguments unpersuasive on when the "main" mistake occurred. In my view it was during the First Hundred Days, and not just because the fiscal stimulus was grossly inadequate (and was too dependent on tax cuts.) The biggest failure was in its grossly negligent response to the housing crisis. Romer writes:

I give the Federal Reserve a lot of credit for preventing the financial crisis from spiraling out of control. They took a number of incredibly creative and aggressive actions to unfreeze financial markets and keep credit flowing in the fall of 2008. In early 2009, they did a round of quantitative easing that helped to reduce mortgage rates and stabilize the housing market.

(Emphasis supplied.) How anyone can praise any government actor for their dealings with regard to the housing crisis is beyond me. The Fed and especially the Obama Administration Treasury Secretary have been miserable failures with regard to the housing crisis.

The obsession with preserving the TBTF banks instead of dealing forthrightly and properly with the toxic assets of the banks and provide meaningful assistance to struggling homeowners is a failure of historic proportions. Romer fails to even mention in passing this collossal failure.

One interesting tidbit that Romer provides is President Obama's distaste for disagreement and his blind faith in the virtues of achieving consensus:

There was a definite split among the economics team about whether we should push for more fiscal stimulus, or switch our focus to the deficit. A number of us tried to make the case that more action was desperately needed and would be effective. Normally, meetings with the President were very friendly and free-wheeling. He likes to hear both sides of an issue argued passionately. But, about the fourth time we had the same argument over more stimulus in front of him, he had clearly had enough. As luck would have it, the next day, a reporter asked him if he ever lost his temper. He replied, “Yes, I let my economics team have it just yesterday.”

The implication is that the President wanted people who disagreed to pretend to agree. This type of attitude is reflected in much of Obama's approach as President, and it is clearly his biggest failing.

Romer continued:

As frustrating and stressful as this period was, it also provides a good window into policymaking in the Obama White House. It was a remarkably intellectual process. You won arguments not by being political or vying for face time with the President, but by having the best evidence.

This is ridiculous from Romer. Better if she had argued that "political constraints" had made the best policies not feasible than to pretend that Obama listened to all the evidence and then adopted the best policy. He did not and does not. Like all pols, he makes political calculations.

Ultimately, the biggest indictment of Romer is that in the "what we need to do" section of her speech, the housing crisis does not even merit a mention.

And this really tells a tale imo. From all accounts, Romer was the most clearheaded and accurate economic advisor the President had. And even she can not come to grips with the centrality of the housing crisis to our economic woes.

Yes, more fiscal stimulus was needed and is needed. Sure, quantitative easing may not hurt. But what continues to hurt the nation's economy is the blithely ignored problems in the housing market.

It truly boggles my mind.

Speaking for me only

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    There's that addled Obama psyche (5.00 / 1) (#1)
    by Dadler on Tue Jun 07, 2011 at 10:17:11 AM EST
    He's still that little boy looking to please everyone, doesn't want too much conflict, or any at all.  It's a very common trait among certain personality types who come from broken families.  The wounded child as peacemaker.  I've been there, I know what it is.  One would think, however, that someone who had risen to this professional level would have some clue as to how those dysfunctions affect their ability to lead in the best manner.  But, um, I guess not.

    This need to please, IMO, is a huge part of what makes Obama, on so many issues, fall back on conservative stances.  And it is what will make it IMPOSSIBLE for him, as some still hope will occur, to have some great progressive awakening in his potential second term.  


    Magic (5.00 / 2) (#2)
    by Stellaaa on Tue Jun 07, 2011 at 10:27:40 AM EST
    For the last three years whenever I hear the surprise over the decline in housing starts and then the ensuing discussion as if the housing market has been fixed I bash my head.  

    Total lack of understanding at the depth and breadth of structural damage the sub prime debacle caused.  They have a total disconnection on how to untangle the mess, because like the Wall Street boys who caused it, none of them have ever had to deal with a real person facing the catastrophe.  

    If I was president I would have taken real homeowners in default, assigned each one to the team, the top staff of the Treasury, the top staff of the regulatory agencies and told them, help this person get through this mess.  First ten days.  Then after that, they could get to work.  Our housing finance system is broken and no one has the capacity to fix it.  

     Instead, they are looking at the entrails of statistics imagining some kind of fix.  

    I think they genuinely believe (5.00 / 7) (#3)
    by Warren Terrer on Tue Jun 07, 2011 at 10:36:04 AM EST
    the housing market will climb back to the heights it was at in the mid 00s thereby rescuing all those underwater home owners. They seem not to understand that the housing market became subject to a bubble and that house prices were driven by speculation and not by market fundamentals.

    Dean Baker keeps pointing out that housing probably has to fall another 10% just to return to historic norms. This will leave people who are underwater further underwater. Even with an economic recovery there is no major boost in housing prices coming. The music has stopped and there aren't enough chairs.


    The jobs situation is also a huge driver (5.00 / 4) (#14)
    by inclusiveheart on Tue Jun 07, 2011 at 02:33:18 PM EST
    in the housing sector.  The housing market was inflated, but if people weren't losing jobs or experiencing overall decreases in their salaries, this housing crisis would not be nearly as extreme.

    They thought that they could ignore both the housing market and jobs which is what blows my mind.  And I agree with you that they thought that both would recover out without much help or attention from them.  It is amazing to me.  Really amazing.  On the policy it is horrible and on the politics it is sheer insanity.


    Except (5.00 / 5) (#15)
    by Warren Terrer on Tue Jun 07, 2011 at 02:42:39 PM EST
    it was the collapse of the housing bubble that triggered the entire crisis and the ensuing mass unemployment.

    Right now it seems that Obama thinks he can ignore pretty well every aspect of the crisis, i.e. jobs, housing market, financial regulation, and focus all his energies on the deficit and the debt, which is exactly the wrong strategy. The double dip is coming. It wouldn't surprise me if the stats that come out in a couple of months show that the double dip has already here. Obama is a complete and utter failure on the economy.


    Yes the housing bubble's collapse (none / 0) (#16)
    by inclusiveheart on Tue Jun 07, 2011 at 02:56:56 PM EST
    was a trigger, but had people not also lost jobs - or had been able to get jobs when they lost them - they would have had had more to bargain with in negotiating loan modifications.  Don't forget that people who have lost jobs have been in many cases forced to look for work in other regions and then forced to sell houses at greatly reduced prices - further driving housing prices down overall - or just adding to the list of foreclosures.

    What the Obama Administration never really understood - it seems - is that they had to do more than just create a floor for the bottom.  They needed to inject enough economic stimulus to create economic activity that could grow then out of these crises.  The best time for that would have been right at the very beginning before people had had to tap into their savings and retirement funds.  Before people had gotten so down that their potential for recovery had been exponentially reduced.  

    They keep saying that their stimulus saved some jobs - saved - and that is incredibly telling because saving jobs is not the same as stimulating job recovery.  Now they are facing a huge threat to those jobs that they saved.  So they are doubly behind.  Not only have they not really created any jobs, but they are also about to lose the jobs that they saved.  They seem to think that some Too Big Too Fail is going to swoop in like the job fairy and fill the void, but we all know that's not going to happen.  Why would any decent investor invest in the US right now?  Bet against us - hedge us - would be more like it.


    I don't disagree (5.00 / 2) (#26)
    by Warren Terrer on Tue Jun 07, 2011 at 04:24:20 PM EST
    but I think it's very important to understand that the housing collapse caused the situation we are now in. Yes mass unemployment is making it worse, but that's how negative feedback loops operate.

    It's important to understand that the housing collapse caused the crisis because it needs to be drilled into people's heads, especially people in DC, that the housing market is never going to recover. At least not in the sense of returning to the levels it was at a few years ago. In fact it's going to have to sink another 10% just be historically normal.

    And this point is important because there are many people, esp. on the right, who believe 'government spending' is what caused the crisis. They are wrong. There was a huge bubble in housing, it collapsed, and that crashed the economy.


    The housing bubble was engineered (5.00 / 3) (#32)
    by inclusiveheart on Tue Jun 07, 2011 at 05:39:58 PM EST
    by Greenspan and The Bush White House - with all kinds of support from the GOP.  It was a way to get money out of people's houses and onto Wall Street.  They all know that, but have to pretend that it was something else - because it was a great heist of American wealth that they pulled off.  The Obama Administration seems intent on not doing anything to reverse that.  The way that that would be reversed would be two-fold - helping with the housing crisis and making it possible for Americans to earn their way out of losses in a good job market.  They have refused to make any effort to do either.  I mean at this point we are talking about outright homelessness for a lot of people and they don't seem to care.  I have no idea where they think that Americans are going to come up with the money to pay their health insurance mandates when they kick in.

    Yup (5.00 / 2) (#27)
    by cal1942 on Tue Jun 07, 2011 at 04:31:55 PM EST
    the housing boom made no sense, it was driven by the finance industry.

    Trouble is, Obama appointed the very people who had watched the bubble grow and had done nothing to stop it.  

    I agree, they seem to think housing will just pick up again and without any economic evidence to support that belief.

    Neo-liberal morons.


    Talk about a total lack (none / 0) (#9)
    by me only on Tue Jun 07, 2011 at 12:48:45 PM EST
    of understanding about the breadth of the situation.

    In Jan 2009 there were 6,443,882 delinquent mortgages in the US.  And if you were president, each of those would have been assigned to the top staff of the Treasury and regulatory agencies.  Mind you, not the entire Treasury department (which has about 100,000 employees, which would mean each employee dealing with 60 defaults, in addition to their normal job), just the top staff.  Sheeesh.


    They appear to be do far removed (5.00 / 1) (#4)
    by Madeline on Tue Jun 07, 2011 at 11:17:02 AM EST
    from citizen realities that they seem to be clueless. It seems to me that they have mindset of class division, where their lives are ok and it really isn't that bad. Even if you have not lost your home, or lost a job, there is also that red flag of blaming people for their ignorance and free spending.

    What confounds me is the arrogance of this administration, right now, of putting so much emphasis on re-election.  There is nothing subtle
    about it either; press releases umpteen email campaigns, fundraisers.  That billion dollar goal it self was itself heartless.


    Well . . . (5.00 / 3) (#5)
    by Towanda on Tue Jun 07, 2011 at 12:08:06 PM EST
    when the "main" mistake occurred. In my view it was during the First Hundred Days,

    In my view, it was in 2008, when the candidate with the far better grasp of the economy was run out of the race by a party that changed its rules to do so.  I said it then, and I'll say it now:  Anyone who didn't see the problems in the economy even early in 2008 and didn't realize the sort of president that we would need -- they also share in responsibility for this debacle.  And as the problems became more apparent, anyone who still allowed themselves to be distracted by glits and didn't see the problems during the campaign in Obama's allegiance to the U of Chicago school of economics, and in his poor performance in the debates when it came to questions on the economy -- they especially share responsibility for the current debacle.

    So they are getting what they deserve.  But I don't deserve it, and my family suffering in this economy don't deserve it, so you can bet that I never will forget nor forgive.  And I am hearing that sentiment a lot these days among many of the suffering, so my bet is that these new Dems will get what they deserve in 2012.

    If so, then we may get a better economic plan, but we will lose so much in other ways.  And it did not have to be this way.  I have given up on the party, and I just about give up on this country, as I plan for the day when I may be able to afford retirement.  I'll take my savings with me to some other country that I can afford and for my health, because this one is making me sick.

    PUMAS ROAR!!!!!!!!! (1.00 / 1) (#6)
    by AngryBlackGuy on Tue Jun 07, 2011 at 12:36:24 PM EST
    You have no idea (5.00 / 4) (#7)
    by Towanda on Tue Jun 07, 2011 at 12:39:27 PM EST
    how dumb you sound.  Railing away in your dumb way about some mythical group is not going to get you and the other Obama fanboyz in the winner's circle again this time.

    So go spend your time, for which you must be paid well by OFA, filling up some other blog with your blather.


    Ignore him, Towanda (5.00 / 1) (#33)
    by Zorba on Tue Jun 07, 2011 at 05:58:48 PM EST
    Don't bother responding.  He's got his mind made up, and he doesn't let reality get in his way.

    Are there any left? (none / 0) (#40)
    by Nemi on Wed Jun 08, 2011 at 06:31:18 AM EST
    I mean blogs that hasn't already put his comments in "permanent moderation" - with a shrug and a yawn. ;)

    ABG BORE (5.00 / 3) (#12)
    by observed on Tue Jun 07, 2011 at 01:46:54 PM EST
    Who was run out of the race? (none / 0) (#8)
    by me only on Tue Jun 07, 2011 at 12:43:09 PM EST
    Exactly (1.00 / 1) (#28)
    by AngryBlackGuy on Tue Jun 07, 2011 at 04:36:11 PM EST
    The myth is the idea that Hillary "my husband was the former president and we ran the DNC" Clinton was forced out of anything.  She was beaten by a better team with a better message. Full stop.

    Move on.  Obama is our President. Move on.


    I don't mind you saying (5.00 / 0) (#31)
    by NYShooter on Tue Jun 07, 2011 at 05:34:17 PM EST
     " Obama is our president;" that's your right.

    But, please don't tell anyone to "move on." That just makes you sound like a tea party idiot.

    (Mind you, I`m not calling you an idiot.)


    She was beaten (5.00 / 5) (#34)
    by TeresaInSnow2 on Tue Jun 07, 2011 at 06:03:17 PM EST
    because the Democratic establishment didn't want the Clintons in office anymore.  And they used every tool in their arsenal including blatant, ugly misogyny to remove her.  Full stop.

    If you want to move on, it's your right.  But the 2008 primaries were full of injustices toward women that I refuse to move on from, even if ABG orders me to.   Have you moved on from injustices toward African Americans?  No.  So suck it up and figure out that maybe, just maybe, many of us won't just move on.  Sorry if that ruffles your pretty feathers


    How nice of you to (5.00 / 3) (#39)
    by nycstray on Wed Jun 08, 2011 at 01:00:56 AM EST
    discredit SOS HRC yet again . . .

    bless your heart, your sexism is so precious  . . .


    Towanda, from whence does this (none / 0) (#35)
    by oculus on Tue Jun 07, 2011 at 06:49:14 PM EST
    moniker spring?  Just curious.

    A favorite character (5.00 / 4) (#36)
    by Towanda on Tue Jun 07, 2011 at 07:02:15 PM EST
    in the marvelous "Fried Green Tomatoes."  The film is great, with Kathy Bates as the mild-mannered woman who, upon menopause, turns into Towanda! Righter of Wrongs, Queen Beyond Compare! who is to be feared, as many find out:

    I never get mad. . . .  Never. The way I was raised, it was bad manners. Well, I got mad and it felt terrific. I felt like I could beat the sh!t out of all those punks. Excuse my language. Just beat 'em to a pulp. beat 'em till they begged for mercy. Towanda, the avenger! And after I wipe out all the punks of this world, I'll take on the wife-beaters and machine-gun their genitals! Towanda will go on the rampage. I'll put tiny little bombs in Penthouse and Playboy so they'll explode when you open them. And I'll ban all fashion models who weigh less than 130 pounds. And I'll give half the military budget to people of 65 and declare wrinkles sexually desirable. Towanda, righter of wrongs, queen beyond compare!  

    As fun as is the film, the book Fried Green Tomatoes is even better for far more of Towanda's internal monologues about what is needed to improve our society.  


    Love it. Carry on! (5.00 / 3) (#37)
    by oculus on Tue Jun 07, 2011 at 07:22:00 PM EST
    When my niece was very young (5.00 / 2) (#38)
    by nycstray on Wed Jun 08, 2011 at 12:56:10 AM EST
    my sister got her a kitten. Niece named the kitten Towanda. Let's just say, that kitten grew up with some 'tude . . .  ;)

    Ack ... (none / 0) (#41)
    by Nemi on Wed Jun 08, 2011 at 04:45:54 PM EST
    And I'll ban all fashion models who weigh less than 130 pounds.
    I just caught a glimpse of Donatella Versace with her daughter Allegra posing on "the red carpet". The young woman is literally only skin and bones. So, so sad. Her mother looks like a freak with all her "work", but that's her business, but my heart aches for that young woman! Ack ...  

    The idea that lowering mortgage rates (5.00 / 1) (#13)
    by ruffian on Tue Jun 07, 2011 at 02:07:43 PM EST
    would significantly help the mortgage crisis was the biggest pipe dream of them all. Most everyone that could take advantage of low rates had already done so in the previous 10 years. 25% of mortgages are underwater. Not even a rate of 0% is going to help those people refinance. And I could go on.

    Even with a clear electoral mandate for change and the blessings of the voters to do something drastic to help main street, the administration showed no willingness to try any kind of creative solution to this problem. That is going to be their downfall.

    The administration whole emphasis (5.00 / 1) (#18)
    by MO Blue on Tue Jun 07, 2011 at 03:23:27 PM EST
    was on Wall St. and those savvy businessmen who could help him raise $1 billion for his reelection campaign.

    The millionaires, billionaires (including those in our government) are doing just great. If you are not, you are just being selfish by not wanting to accept the status quo.


    Absolutely - First 100 Days (5.00 / 1) (#20)
    by cal1942 on Tue Jun 07, 2011 at 03:44:13 PM EST
    Swift, strident action on several fronts was imperative.  Instead we got this 'just right' claim from the Obamas when over the top was needed.

    Romer's claim that the housing market has been stabilized is straight out of wishful thinking wonderland.  Housing prices continue to decline except in a few areas.

    We often heard people talk about how 'cool' Obama was.  Too damn cool.  My impression is that he lacks any passion except for dispassion.  

    I've never minded the dispassion (5.00 / 1) (#25)
    by ruffian on Tue Jun 07, 2011 at 04:21:38 PM EST
    I think you can be dispassionate and bold and make the right decisions at the same time. Unfortunately one out of 3 does not cut it.

    I just read (5.00 / 0) (#29)
    by cal1942 on Tue Jun 07, 2011 at 04:51:55 PM EST
    some background on Christine Romer.

    Incredible.  Another monetarist.  Or at least that's my impression.

    She doesn't believe fiscal policy helped end the depression.

    I wonder what she thinks WWII spending was.


    Sounds like we'd be better off (5.00 / 4) (#30)
    by observed on Tue Jun 07, 2011 at 05:08:22 PM EST
    if Nancy Reagan's astrologer were in charge of economic policy.

    A Christina Romer trial balloon for Obama working (5.00 / 1) (#42)
    by jawbone on Wed Jun 08, 2011 at 07:26:54 PM EST
    with the Repubs on Medicare "changes"?

    She's against the Paul Ryan plan, but is still touting her and Pete Domenici's plan. Ooof. More muddying the waters for Democrats trying to win or hold on to Congressional seats.

    The basic concept of premium support is to provide beneficiaries with a subsidy to select among comprehensive health plans offered on a regulated exchange. The plans can all be private or can include a public option. The plans must accept all eligible beneficiaries--guaranteeing access and preventing cherry picking--but the plans will be fully compensated for taking care of older or sicker people. The government subsidy will be capped at a predefined level and growth rate, so it is a defined contribution system, but the cap can be changed by law. If this general structure reminds you of the Massachusetts Connector, the subsidies and exchanges created by the Affordable Care Act, or even Medicare Part D, then you get the idea.

    The Bipartisan Policy Center's Debt Reduction Task Force, which I co-chaired with former Senator Pete Domenici (R-NM), proposed transitioning Medicare to premium support starting in 2018.  In our version, all Medicare beneficiaries would have a choice: Either stay in traditional fee-for-service Medicare or choose a comprehensive health plan on a newly created Medicare Exchange. The growth of the total subsidy--both for traditional Medicare and for the Exchange---would be capped at the growth of the economy (GDP) plus one percent.  If the cost of traditional Medicare grows faster than that, then its beneficiaries would either have to pay an additional premium or move to the exchange.  To protect lower income beneficiaries, the premium could be related to income, although we did not actually spell this out in our plan.

    I just completed making my selections for Medigap and RX supplemental coverage. I had looked into a Medicare Advantage plan here in NJ, but the copays were a tad high and the insurance company refused to tell me what run of the mill lab tests would cost: "Anywhere between $35 and $125 per test," they would say, if they said anything. I took extra time collecting diagnostic codes from my doctors -- and still got the same answer.

    So I could not in any fact-based way compare the cost of Medigap to Medicare Advantage. It was infuriating.  I tried to imagine being ill and in my upper 70' or 80's trying to get usable information out of the insurance company reps in order to make my annual insurance decision.

    That's when I decided to go with an AARP supplemental plan. Even the docs who don't take assignment are covered, so I at least know what my exposure for the remainder of the year is. And I won't have to deal with health insurance games and misinformation.

    Now, Rivlin wants to make Medicare into ObamaCare, the health insurance company profit protection plan Obama worked so hard to get through Congress.  Instead of trying to give everyone "something like Medicare," Rivlin (with Obama's support, go ahead?) wants to drag seniors down to ObamaCare's unequal coverage. The kind of insurance which doesn't really cover much.

    No thanks, Ms. Rivlin. But I figure the Repubs will use your words, this post to attack Dems from the left, as they did so well in 2010.

    Have we no real Democrats from the Democratic Wing of the Democratic Party any longer?

    At least Obama has brought greater clarity to the divide within the Dem Party -- it is now harder for people to not miss that some Dems are Corporatists (and Neolibs, but that's less recognizable to many voters than sucking up to Wall Street and Big Bidness) and some are actually interested in improving the lot of little people.  

    Point being: It's Obama making the decisions -- he (5.00 / 1) (#43)
    by jawbone on Wed Jun 08, 2011 at 07:30:20 PM EST
    is not being led around by the nose by his appointees. Really.

    He set up the Cat Food Commission. He named Geithner.  He named Rivlin to that commission. It's his administration. His mistakes, his economic decisions.


    Correction: Alive Rivlin trial balloon! (5.00 / 1) (#44)
    by jawbone on Wed Jun 08, 2011 at 07:43:32 PM EST
    Saw the error, meant to correct -- and forgot. Ooops.

    The problem is that Obama is (none / 0) (#10)
    by observed on Tue Jun 07, 2011 at 01:14:59 PM EST
    clueless about his limitations. He's not willing to trust someone else's opinion about the economy, because he believes in his own judgment.
    I really think his split the middle approach is well-suited to foreign policy, but totally wrong for economic policy, because 30 years of mythologizing Reagan's mistakes have left the economic profession half crazy.

    I think he's (5.00 / 0) (#11)
    by Warren Terrer on Tue Jun 07, 2011 at 01:24:11 PM EST
    far too willing to trust someone else's opinion about the economy, namely Geithner.

    I think this can also be seen in his reliance on consensus, i.e. he expects that experts can be got together in a room and through their expertise a consensus must emerge and then Obama can simply defer to that consensus. I think he's clueless about the limitations of consensus of experts as a way of setting policy. He's the exact opposite of the decider.


    You mean like this ;) (5.00 / 3) (#17)
    by Nemi on Tue Jun 07, 2011 at 03:22:32 PM EST
    (from Oprah's Christmas Special at TWH 2009):

    Oprah: "When's the last time you lost your temper?"

    Obama: "Yesterday. When I was talking to some of my economic advisors, and--and there was a-- .. A debate about an issue that had come to me, uh, three times in a row, and they didn't seem to resolve it, and I-- now I don't--I don't yell. (chuckles) And clearly. There's a little edge that creeps into my voice where people know that I'm not pleased."

    Oprah: "But you've never been a yeller?"

    Obama: "I--you know, I don't yell. A-and I actually find .. I don't know, uh, about you, Oprah, but I-I find that, uh, when you don't yell, it's a little more effective."


    Exactly like this (5.00 / 5) (#19)
    by Warren Terrer on Tue Jun 07, 2011 at 03:24:51 PM EST
    Obama is ignoring jobs, ignoring housing, ignoring financial reform, and the economy is going back into recession while he worries about the phoney issue of the deficit. But hey, at least he's not yelling.

    And the exact opposite (5.00 / 2) (#21)
    by cal1942 on Tue Jun 07, 2011 at 03:48:31 PM EST
    of a truly effective President.

    Many academic economists (5.00 / 1) (#22)
    by cal1942 on Tue Jun 07, 2011 at 03:51:01 PM EST
    are corrupt, seriously compromised people and that's one of our many problems.

    And, because of Obama, we aren't (5.00 / 2) (#24)
    by observed on Tue Jun 07, 2011 at 03:55:29 PM EST
    even having any discussion at all about global warming.

    Right. Is that something new, say (none / 0) (#23)
    by observed on Tue Jun 07, 2011 at 03:54:02 PM EST
    as compared to 20 years ago?

    I don't trust ANYONE outside of a very small circle of economists, because I don't know who is corrupt. For example, there is a Russian named economist---starts with K---who writes a lot about the long terms problems with SS and Medicare. He's very pessimistic, whereas Krugman says the guy is wrong. How can I tell? Do I know the other guy is honest?


    I'd Trust (none / 0) (#45)
    by cal1942 on Fri Jun 10, 2011 at 08:21:10 AM EST
    Krugman on SS.  The SS Trust Fund is worth $2.4 trillion.  All the long term stuff I've read says SS can deliver by increasing the maximum for withholding.

    Overt corruption (none / 0) (#46)
    by cal1942 on Fri Jun 10, 2011 at 08:30:54 AM EST
    may have come in the 80s but evidence could probably be found earlier.

    Academic economists writing papers that promote a business, sit on the board of directors of financial institutions, insurance companies, etc.

    Prestigious universities seem to have no problem with these conflicts.

    See Inside Job, which has a segment on the corruption of academic economists.