Surowiecki gets bold in defense of Tim Geithner’s non-boldness

Jim Surowiecki, riffing on my post from last week on possible reasons for Treasury’s less-than-bold approach to the banking crisis, which was itself a riff on a Ryan Avent riff on a Gary Weiss profile of Tim Geithner (yes, we bloggers are news-gathering dynamoes), writes:

It’s true that the administration’s approach may not be bold in the sense of being radical, but no one believes that boldness is, in itself, a good thing or that the more radical a solution is, the better it must be. (The Bush Administration’s decision to invade Iraq was certainly bold and radical. That didn’t make it any less of a mistake.) More important, the boldness issue is really a red herring. Obama’s critics’ problem with the Administration isn’t really that they think it should act more decisively: it’s that they think the Administration should act differently.

That’s not entirely right. At least some of the criticism of the Administration’s approach to the banks comes from people like me who wonder why the President and Treasury Secretary have never articulated their strategy as clearly as Jim Surowiecki has.

Update: At lunch today I sat at the same table as a Kurdish official who said the U.S. invasion of Iraq will go down in history as one of the best things ever. I forgot to ask him what Geithner should do about the banks.

Stocks Rally Further in Run-up to EU Summit

MOSCOW — Global stocks enjoyed one of their best days in weeks on Tuesday ahead of a summit of European leaders that’s expected to be dominated by calls to boost economic growth.

Europe remains the focus of attention across all financial markets in the run-up to the June 17 Greek election that could go a long way to determining the country’s membership of the euro as well as the future of the single currency zone.

donthelibertariandemocrat

“wonder why the President and Treasury Secretary have never articulated their strategy as clearly as Jim Surowiecki has.”

It’s a fair point, but, if I were in the govt, I would assume that only actual improvements are going to do any good at this point. In other words, it’s no longer a matter of being convincing in words. Also, if you say, as I do, that the options are limited and ugly, you’re likely to be considered a whiner. People will just tell you to shut up and get out then. Besides, Lincoln couldn’t convince many people who are disinclined to accept the govt’s approach.

Finally, I’ve read Geithner make many of the points that people claim that he hasn’t. We already have legislation to seize large financial concerns being put forward, and he’s admitted plenty of mistakes. I would like Narrow Banking, and that isn’t even gaining traction on blogs, but it’s hardly only Geithner’s fault that I’m not being listened to.
tc125231

I don’t think the discussion is actually on target . I mean, you’re all quite brilliant and interesting, don’t get me wrong. But I don’t think that you have diagnosed the same problem as the Geithner/Obama “critics”, and I don’t think either of you have made a substantive case for your diagnosis. Maybe the other guys haven’t either. That’s why these things should be discussed without character assassination.

Many of us voted for Obama, donated money to Obama, and, in general think he is doing a pretty good job. Where we part company is in the diagnosis of the problem to be solved. Metaphorically speaking, he’s like the AAA tow truck driver who just wants to fix your flat and get you back on the road. He chooses not to consider that you blew your tire because you were driving drunk.

All these folks who call Johnson or Krugman “radical” just confuse the issue. It’s not that these folks are radical, it’s that they perceive a different problem. Krugman and Johnson, in different ways, do not think that either the protagonists, or the structure, of the current financial system are going to lead to safe and sober driving, once Obama/Geithner get the tire fixed. They think, to torture the metaphor a bit further, that spending a great deal of money to put them back on the road in their current state is just going to “enable” a DUI related reckless homicide down the line.

If their diagnosis is correct, there is nothing “radical” about their proposals. So, while it is legitimate to argue with their diagnosis, calling them “radicals” is like calling Larry Summers a closet influence peddler. I mean, it IS fun, but in the end, not really constructive.

This, by the way, is similar to the garbage thrown out about global warming. Will the glaciers in the Hindu Kush melt within 20 years, severely shrinking water supplies available to a billion people, and significantly increasing the percentage of solar radiation absorbed –thus increasing the rate at which planetary temperatures increase, and destabilizing the geopolitics of Asia as a billion people start to migrate?

If you have good evidence refuting such a contention, then by all means bring it forth. But suggesting that proposals to ameliorate the rate at which such things occur are “wasteful” and “radical” is pretty unhelpful. Because, if it IS true, SOMETHING has to be done.

If it’s not true, and you want argue that case, that’s great. People have said the sky was falling before. Even the brilliant ones have often been wrong. The only thing is –this time the evidence is a little better.

What happens in the next few years matters, both to Curious Capitalist Junior, and to the rest of our children and grand children. This is not a drill.