Wednesday, July 25, 2012

Now he Tells Us

U.S. Treasury Secretary Timothy Geithner is disappointed in the economy, according to a report in Real Clear Politics, and the economy is likewise disappointed in him. More accurately, it is disappointed in Mr. Geithner’s boss, President Barack Obama. Mr. Geithner is but a soldier used to taking orders in Mr. Obama’s progressive administration.    

"I'll tell you my general view on this," Secretary of Treasury Tim Geithner said about the economy in his testimony to Congress. "The economy is not growing fast enough. Unemployment is very high. There's a huge amount of damage left in the housing market. Americans are living with the scars of this crisis."

If Mr. Obama loses the presidential election to Republican presidential nominee Mitt Romney – as yet a big “if”, for the polls suggest a close tie at the moment -- there will be an autopsy on Mr. Obama’s years in office. And someone not tied to the progressive afflatus is almost certain to point out that Mr. Obama easily might have won the election if…

If what?

If – per impossible – there had been someone on the team who had successfully challenged Mr. Obama’s alarming presumption.

If Mr. Obama had concentrated the vast energies of his office on settling just two problems – the housing meltdown, and the anemic economy – he would be undefeatable right now. But Mr. Obama grabbed for the progressive brass ring, universal health care, and that is why his re-election hopes are now foundering. No government is omni-competent; and the more a government does, the more it will do poorly. Come to think of it, that is why the founders of the nation relied on the doctrine of enumerated powers when they cobbled together the U.S. Constitution, leaving the powers not enumerated in the Constitution to the states and the people in the states.

The housing industry in the United States was an is a mess, chiefly because politicians from the Clinton administration forward wanted to make it possible for more people to own houses. To this end, banking standards were lowered so as to allow those who could not afford mortgage payments to purchase houses. A housing bubble soon emerged and burst, flooding the market with toxic assets intricately woven into Wall Street created paper products.

One gets out of the dark and gloomy forest the same way one has gotten in. But the reverse trip, so the fairy tale tells us, bristles with difficulties. It is clear to everyone who has a head that banking standards should be restored and toxic assets should be flushed out of the market. It is clear to everyone who has a heart that these solutions will spot the floor with blood, if only because people have their futures invested in failed assets.

Solving this problem would have been difficult – but doable. No one wanted to solve it. And so we march on through a wounded economy to a European destination, perhaps Greece or Spain.

However, it seems we will have, somewhere down a ruined road, a government run health care system that may, in time, rival the U.S. Post Office, shaped by the same people in Congress who have not given us a budget since Mr. Obama took charge of the White House, the legislative architects of a $15 trillion budget deficit and a much plundered national social security system on the verge of bankruptcy.

Perhaps when Mr. Geithner leaves office, he might offer the nation some sound economic advice. So long as he remains in office, he will do and think as he is bid.  
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