American Elephants

This is an uncomfortable week, waiting, as it were, for the other shoe to drop.  I know how we got here, but I have no insight whatsoever into how we will get out.  It’s above my pay-grade, as someone said recently.  I have read too many columns by too many economists who don’t agree with each other.

The fox is in charge of the henhouse; or rather Barney Frank is in charge of the committee to solve the problem that he was most prominent in creating. Of course he blames it on Phil Gramm. Huh? And of course, President Bush, that’s a given.  Everything is Bush’s fault.

Phil Gramm’s Gramm-Leach-Bliley act which “deregulated” Glass-Stegall is explained well, and briefly by Megan McArdle in the Atlantic.

Obviously, when the mess is so big, everyone is looking for a scapegoat, in the absence of knowing just the right thing to do about it. It is, of course, much more complicated than just helping poor minorities to become homeowners.  That is a worthy aim.

Businesses develop guidelines for success in their operations.  Congressmen have found that they enjoy greater success at the ballot box if they give people stuff.  Hence all sorts of mischief.

Congress has gotten itself into the habit of thinking it can tell business how to conduct its operations.  You have given oil companies a lease on public land in exchange for vast sums, and they haven’t brought in any oil wells yet — just order them to produce oil, now.  Car mileage isn’t high enough (since most customers want higher gas mileage, obviously car companies aren’t paying attention) congress will just order them to increase mpg now.  Few members of congress have ever successfully run a business, yet they assume expertise that they do not possess, issue orders in the form of legislation and create problems.

I’m afraid we need to remind our representatives more often that they are not some sort of elite, but our servants.  They work for us.  And they need to remember that.