Regulation

Popularity Does Not = Prudence

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The White House is touting this Pew Research Poll [PDF] from yesterday showing that 57 percent of Americans favored the initial outlines of the proposed massive federal bailout of the financial sector. However, a new L.A. Times/Bloomberg poll says 55 percent of Americans oppose a Washington bailout.

In any case, marginal poll advantages are hardly any way to run economic policy. For instance, as Robert Samuelson reminds us in today's Washington Post, both those figures above positively pale in comparison to the public support for one of the most odious economic policy measures during reason's 40 years of existence (donate now!):

Contrary to much commentary, Paulson's plan would not be the largest government intervention in the private economy since World War II. That distinction still belongs to Richard Nixon's imposition of wage and price controls in August 1971. True, Paulson would socialize unprecedented amounts of private debt, but Nixon asserted control over the entire economy. What's fascinating are the possible parallels between the two episodes, starting with a shared irony: Both came from administrations committed to "free markets."

When Nixon declared the wage-price freeze—a complete surprise because he had consistently opposed controls—the decision proved "wildly popular," Rice University historian Allen Matusow writes in his book "Nixon's Economy." By one survey, 75 percent of Americans supported it.

"There was widespread public rejoicing that at last the government was protecting the people," Herbert Stein, a Nixon economist, later observed. Consumer price inflation, which had been rising at a 4 percent annual rate, dropped toward 1 percent. People believed that by acting decisively government could outlaw inflationary psychology. It couldn't.

reason on wage and price controls here.

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  1. Wall St. investors make terrible investments that they should have known were terrible investments – fuck’em

    A lot of people in suburbs of sunbelt cities buy houses they should not have bought because they can’t afford them and didn’t understand what they were signing because they didn’t read the f’ing agreement – fuck most of ’em

    A city has rerouted the fucking Mississippi river for economic reasons and prevented it from depositing sediment so that the city sank, which, among other things, eventually led to an obvious-to-anyone flood disaster and was touted in the media as a “nobody could have known this could happen” event when I learned about it in introductory geography 3 years before it happened – We have to help these poor people!!!!

  2. Free market fundamentalism is on the ropes. Donate now!

  3. Lefiti’s meds are running low. Donate now!

  4. If Congress and the President want to run the country on polls, we can just institute national referendums through a Diebold contract and send all the elected officials home. There is nothing fairer deciding national policy by giving equal stakes to everyone regardless of their proximity or concern with the matter!

    Administering the frequent votes will be cheap. We will use internet polls.

    My first proposal will be to distribute $1000 in relief to a predetermined 51% of the voting population, funded by a $1000 tax on the remaining 49% of the voting population. The surplus will cover administration costs.

  5. I cannot believe the number of people who actually believe the government has the power to magically “fix” the economy. We should just send the economy to Lourdes to be healed.

  6. The Paulson plan effectively makes the government the largest homeowner in the US. That makes them effectively in charge of housing supply and housing demand at the same time.

  7. I cannot believe the number of people who believe that the economy is the one area of human activity that requires no corrective intervention.

  8. Free market fundamentalism is on the ropes. Donate now!

    I thought you were leaving and never coming back?

    WTF?

  9. I cannot believe the number of people who believe that the economy is the one area of human activity that requires no corrective intervention.

    That’s because it corrects itself. Or at least it has been trying to no thanks to government meddling.

  10. Free market fundamentalism: the market is to rule supreme, unrestrained by the intervention of government, labor unions, or anything else (other than corporate monopoly power) that constrains the operation of market forces, regardless of how much social disorder, suffering or exploitation results. Monopolies are simply assumed, against all evidence, to be self-limiting (though no one ever managed to explain how DeBeers Consolidated Mines had managed to create and maintain a worldwide monopoly on the diamond business for more than a century).

  11. “Financial markets are inherently unstable and there are social needs that cannot be met by giving market forces free rein. Unfortunately these defects are not recognized. Instead there is a widespread belief that markets are self-correcting and a global economy can flourish without any need for a global society. It is claimed that the common interest is best served by allowing everyone to look out for his or her own interests and that attempts to protect the common interest by collective decision making distort the market mechanism. This idea was called laissez faire in the nineteenth century… I have found a better name for it: market fundamentalism.
    It is market fundamentalism that has rendered the global capitalist system unsound and unsustainable.
    … it was only when Margaret Thatcher and Ronald Reagan came to power around 1980 that market fundamentalism became the dominant ideology. It is market fundamentalism that has put financial capital into the driver’s seat.”–George Soros

  12. Who let this heretic into the catechism class?

  13. Keeping prices from rising sounds a lot better than a bailout to the public.

  14. looters pillagers

    panic in the streets today

    congress on the job

  15. “Does Not =”, Matt? What, you don’t have a ? key on your keyboard?

  16. Lefiti, according to wikipedia:

    “Mining in Botswana takes place through the mining company Debswana,[3]a 50-50 joint venture with the Government of the Republic of Botswana. In Namibia it takes place through Namdeb,[4] a 50-50 joint venture with the Government of the Republic of Namibia. Mining in South Africa takes place through De Beers Consolidated Mines (DBCM),[5] 74% owned by DeBeers and 26% by a broad based black economic empowerment partner, Ponahalo Investments. In Tanzania it occurs through a partnership with the government of Tanzania, 75% owned by De Beers, 25% by the government. In 2007 De Beers began production at the Snap Lake Mine in Northwest Territories, Canada;[6] this is the first De Beers mine outside of Africa. In July 2008 De Beers opened the Victor Mine in Ontario, Canada.[7]”

    Sounds like a counter-example to me…

  17. The White House is touting this Pew Research Poll [PDF] from yesterday showing that 57 percent of Americans favored the initial outlines of the proposed massive federal bailout of the financial sector.

    Chumps.

    In related news, Wall Street plays the free market card:

    “We support the bill, but we are opposed to provisions on executive pay,” said Scott Talbott, senior vice president for government affairs at the Financial Services Roundtable, a trade group. “It is not appropriate for government to be setting the salaries of executives.”

    They’re cute.

  18. Is it appropriate for government to be setting the salaries of non-executives?

    Surely they’re aware of what they’re implying???

  19. Lefiti or Leftii-

    In your behalf, in order to avoid or minimize social disruption, the government has appointed Epi and myself as your co-guardians. We will be making sure to adminster your meds to you, forcefully, if necessary.

    You have heretofore enjoyed a monopoly on “taking care of yourself”-if you could call it that. It is time to end that monopoly.

    Epi- Since I am busy this afternoon, would you be kind enough to give Leftii his meds?

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