Day: September 15, 2008

McCain, the economist

On the worst day in the stock market since 9/11, McCain announces his idea for solving our economic problems. He explains the cause:

bq. the old-boy network and the corruption in Washington is directly involved and one of the causes of this financial crisis that we’re in today.

I wonder if McCain has forgotten that he was part of that “old-boy network and corruption in Washington” for the last 26 years. I know he hopes we all forgot.

So his solution is to create a “a high-level commission”: to investigate similar to the “9/11 commission”: We’ll ignore the fact that the Bush administration ignored all the recommendations of the 9/11 commission report, but McCain thinks bureaucrats will solve the problems that, he believes, bureaucrats created.

He is correct that bureaucrats created the problem. Republicans and McCain hate regulation and the housing and banking crisis we’re experiencing was caused by the de-regulation that the Republicans have wanted for years and got in the mid-1990s. “McCain supported the de-regulation”: that caused it! In fact, 38 of the 39 Democrats in Congress voted against it and all 44 Republicans voted for it. This was a problem clearly created by Republicans, as McCain correctly pointed out.

Now, McCain’s own economic advisor has a solution:

bq. a McCain economics and policy adviser, Douglas Holtz-Eakin, said any plan should include regulation of all sorts of financial institutions, consumer protections, improved corporate governance and “systems stability” programs.

In other words, we just need to undo McCain’s mistake. Yet McCain thinks we need a commission to spend several years thinking about it. Republicans have no understanding of economics beyond cutting taxes.