2008/09/23

The economics education of our president

Y'know, is it just me, or does it sound as though President Bush, after seven and a half years on the job, is just now getting some idea as to how the economy works?

The president finally took his first two questions about the exploding financial crisis on Saturday, in a joint appearance with Colombian President Alvaro Uribe: "I know -- look, I'm sure there are some of my friends out there saying, I thought this guy was a market guy; what happened to him?
"Well, my first instinct wasn't to lay out a huge government plan. My first instinct was to let the market work until I realized, upon being briefed by the experts, of how significant this problem became.
"And so I decided to act and act boldly. It turns out that there's a lot of interlinks throughout the financial system. The system had grown to a point where a lot of people were dependent upon each other, and that the collapse of one part of the system wouldn't just affect a part of the financial markets; it would affect the average citizen -- and how. Well, it affect their capacity to borrow money to buy a house or to finance a college loan. It affect the ability of a small business to get credit. . . .
"I asked Hank Paulson -- who, by the way, in my judgment, is doing a fabulous job; he's got a lot of credibility and he's working, and his team are working hard, as are the people at the Fed and the SEC -- I said, what's it going to take to make sure Main Street doesn't get affected by the policies of Wall Street? And this is what they came up with, and this is big ticket, because it's a big problem. . . .
"And I believe this is going to work. We had the considered judgment of a lot of capable people. It's not only just here in Washington, but our people were listening to a lot of other voices. And we took our time to come up with a strategy and a plan that would address the problem. . . .
"And, you know, I know a lot of people here in Washington, Mr. President, saying, well, who to blame? Now is not the time to play the blame game. There's plenty of time to analyze the situation. But from our perspective, it's time to solve the problem, and that's what we did."

Of course, "play[ing] the blame game" would hurt Bush's corporate buddies and all his rich friends wouldn't like him anymore if he did that. But for Bush to just now be discovering that there are "interlinks" and that "the collapse of one part of the system wouldn't just affect a part of the financial markets; it would affect the average citizen" caused me to do a real double-take. Did this fellow really come into the Oval Office with that shaky a grasp as to how the economy works? Has his knowledge really been that shallow the whole time?

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