We didn’t get much into Montana Democrat Jon Tester’s questions in the liveblogging of the Senate Banking hearing, but he was pretty entertaining. Plus he asked this (from Andrew Leonard):
Why do we have one week to determine $700 billion that has to be appropriated, or this country’s financial systems go down the pipes?
Wasn’t there some opportunity sometime down the line where we could have been informed of how serious this crisis was so we could take some preventative steps before this got to this point?
If only Jon Tester had been reading the Curious Capitalist, where we were talking about an $850 bailout price tag back in March. He would have been even better informed if he’d been reading Nouriel Roubini’s RGE Monitor, although that can get kind of depressing. There were plenty of warnings that this could turn into a serious crisis.
Hank Paulson and Ben Bernanke were perfectly aware of such warnings. They just (a) were hoping things wouldn’t turn out that way and (b) didn’t really think it was appropriate to be voicing such concerns before a full-blown crisis had materialized.
They didn’t want to be accused of turning it into a self-fulfilling prophecy. Which isn’t entirely unreasonable of them. But it means members of Congress shouldn’t really be relying upon the Treasury Secretary and Fed Chairman as unbiased sources of financial and economic information.