Obama's Economic Team

Following up on my previous post, "Economic Meltdown", I present the following:

President Elect Obama says that he is building a team of strong personalities and differing opinions to encourage vigorous debate. However, to me it appears that he is building a chorus of Italian tenors. Where are the basses, the altos, the sopranos in this chorus? His team of economic advisers does not include the bearer of the gold standard, the Libertarians, nor the voice of a Keynesian nor that of a farm economist. Neither is there a representative of small business nor the industrialists nor the wage earner. They are all "big money" Wall Streeters; big banks, investment houses, stock marketeers, etc. It looks like a very homogeneous group who will find it easy to agree on continuing the status quo. And the status quo is what brought us to where we are now.

Where is James Galbraith? Where is Paul Krugmen? Where is Robert Barro? Where is Joseph Stiglitz? Where is Andy Stern (SEIU)? Where is (excuse me) "Joe the plumber" or "Hank the Farmer"? The only liberal voice who has been around and advising Obama (without an official title) is Robert Reich. And he could certainly use the voice of U.S. Representative Ron Paul (R-TX) or someone equivalent to him on economic issues..

Quoting from a column written by David Corn in the Washington Post on December 7, 2008, This Wasn't Quite the Change We Pictured:

"Obama's economic team isn't particularly liberal, either. Lawrence H. Summers, who as President Bill Clinton's Treasury secretary opposed regulating the new-fangled financial instruments that greased the way to the subprime meltdown, will chair Obama's National Economic Council. To head Treasury, Obama has tapped Timothy F. Geithner, the president of the New York Federal Reserve, who helped oversee the financial system as it collapsed. Each is close to Robert Rubin, another former Clinton Treasury secretary, a director of bailed-out Citigroup and a poster boy for both the corporate wing of the Democratic Party and discredited Big Finance. Obama's Economic Recovery Advisory Board will be guided by Paul Volcker, the former Fed chairman whose controversial tight-money policies ended the stagflation crisis of the 1970s but led to a nasty recession. (A genuinely progressive economist, Jared Bernstein, will receive a less prominent White House job: chief economic adviser to Vice President Joe Biden.) "

A similar analysis can be done on Obama's foreign policy team, but I will leave that for a future date. Right now I am most concerned about where this country is headed economically and Obama's team is lacking needed voices.

Michael

Financial Meltdown

In his November 25, 2008 column in the New York Times, All Fall Down, Thomas Friedman discusses the current Wall Street meltdown. Reflecting on a Times front page story of November 23, 2008 by Eric Dash and Julie Creswell, titled "Citigroup Pays for a Rush to Risk", Friedman states:

. . . in searing detail it exposed — using Citigroup as Exhibit A — how some of our country’s best-paid bankers were overrated dopes who had no idea what they were selling, or greedy cynics who did know and turned a blind eye. But it wasn’t only the bankers. This financial meltdown involved a broad national breakdown in personal responsibility, government regulation and financial ethics.

Further down in his column Mr. Friedman refers to an article by Michael Lewis published in the December 2008 issue of Politico.com, The End:

check out Michael Lewis’s superb essay, “The End of Wall Street’s Boom,” on Portfolio.com. Lewis, who first chronicled Wall Street’s excesses in (his 1989 book) “Liar’s Poker,” profiles some of the decent people on Wall Street who tried to expose the credit binge — including Meredith Whitney, a little known banking analyst who declared, over a year ago, that “Citigroup had so mismanaged its affairs that it would need to slash its dividend or go bust,” wrote Lewis.

Together these three articles (All Fall Down , Citigroup Pays for a Rush to Risk and The End) paint a picture that leads one to question whether President Elect Obama's choices for his economic team and advisers will act in the public interest or in the greedy interests of their Wall Street buddies who sold out our country. Too many of them either were directly involved and/or participated in the creation of the conditions which have caused the meltdown or were somehow promoting the environment.

The story is amazing. The consequences are tragic. I strongly recommend that you read these articles, especially the one by Michael Lewis, The End. Beware that the article is very long but it is definitely an eye opener.