Friday, October 03, 2008
Greg Mankiw On The Nationalization Of Finance
What is my opinion about all this? I am of two minds about the complex situation we find ourselves in.
On the one hand, I share many of the concerns of the letter signers and other critics of the Treasury plan.
On the other hand, I know Ben Bernanke well. Ben is at least as smart as any of the economists who signed that letter or are complaining on blogs and editorial pages about the proposed policy. Moreover, Ben is far better informed than the critics. The Fed staff includes some of the best policy economists around. In his capacity as Fed chair, Ben understands the situation, as well as the pros, cons, and feasibility of the alternative policy options, better than any professor sitting alone in his office possibly could.
I were a member of Congress, I would sit down with Ben, privately, to get his candid view. If he thinks this is the right thing to do, I would put my qualms aside and follow his advice. (link)
Now I understand full well that Hahhhvaaard buffon Greg Mankiw is ALWAYS angling for a cushy policy job; he's always out there bootlicking the *candidates*.
Nevertheless it's tragic that someone so allegedly learned would defer expertise to Bernanke simply because Helicopter Ben *understands the situation* better. Precisely what in the past several months - with bankruptcies, bailouts, bank-runs, etc - has bespoken of Federal Reserve omniscience???
This country was founded on the very principle that the people are wiser than the government.
And when Greg Mankiw is properly lumped in with the socialists running the country the above still holds true.