Monday, May 19, 2014

Krugman on Geithner's bailout whitewash

He lays into Geithner's new book, the latter defending the bailout. Yes, it saved us from a total meltdown. But the philosophy that if we save the banks we save the economy has proven false. The banks have certainly recovered and are doing well, but where's the jobs and how are the rest of us doing? Obviously not so good.

Krugman attributes this to Geithner's austerity policies, like denouncing the stimulus program. He also opposed mortgage debt relief, which Krugman uses experts to contradict this, asserting it is definitely holding consumer spending down. It's as if Geithner accepts the conservative spin that the problem was with the borrowers getting in over their heads, while not accepting the proven facts that it was the bankers who deliberately wrote bad mortgages because they wanted them to default so as to fulfill their corrupt bets that they would indeed fail. And crash the economy in the process.

Saving the banks but not the people they deliberately abused seems much more akin to the old and conclusively proven specious trickle down theory. And it's still not working for most of us, while further enriching the top 1%. Krugman is not buying Geithner's revisionist history, and neither should the rest of the progressive movement.

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