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Default Top 25 People to Blame for the Economic Crisis

February 18th, 2009, 00:28
I didn't want to derail any of the serious and largely (to me)incomprehensible economics discussions we're having in other threads, so I'm sticking this up on it's own for a little light relief.

Ran across this article today in Time and thought it might be worth a little finger-pointing and whining, which always leaves me feeling a bit cheerier in the midst of economic chaos. It's a list of the 25 people Time has picked as being the most blamable for what's going down, with a little summary of why they rate this high honor—and you can vote on your personal ranking as well. So get your wax warm and start making your own personal voodoo-economics dolls after perusing:


The Top 25 Economic Losers

(this is Time's pick.)
Here's the list by popular vote.

My personal favorite is Phil Gramm at # 2, and #1, respectively, but there's a lot to be said for The American Consumer(#5) Alan Greenspan, Bush, Paulsen, Chris Cox and Clinton, among others.

There's also a handy list of the Top Ten Financial Crisis Buzzwords—can you say credit default swap, boys and girls?

Enjoy.

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February 18th, 2009, 08:03
Hm. If Clinton's in, then Reagan should be in too. After all, he's personally responsible for the two biggest structural causes of the crisis: the credit expansion and the idea that government intervention (specifically through regulation) is always bad. He also appointed Alan Greenspan, who's personally responsible for blowing both the dotcom bubble and the real-estate bubble. Plus, he turned supply-side economics from mudsling-style obscure crankdom into official economic policy, which ended up wrecking middle-class income growth and federal budgets, and is still virulent enough to prevent Republicans from playing a constructive role in addressing the crisis.

Come to think of it, if there's a single individual most responsible for this mess, it would have to be Ronald Reagan.
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February 18th, 2009, 08:48
I thinnk the entire capitalism system is to blaim.

It annoys me when people say we have to spend more to get out of the crisis on one end, and the environmental friends on the other side says like, we have to learn to consume less……

It is contradictions, and given the state of the earth these days, consume less should win, which means we need another system not based on consumption!
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February 18th, 2009, 11:20
It was very interesting to see Clinton on CNN disputing this. I mean, he oversees dismantling a regulation that led to the massive expansion of subprimes, yet only takes credit for the upsides? Nice try!

And yeah, I think perhaps Reagan … though there were enough signs and recessions (including a very deep late 80's one) that showed how to deal with the downsides of those policies that we might as well lump in everyone back through FDR to Herbert Hoover if we include Reagan …

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February 18th, 2009, 12:28
Originally Posted by GothicGothicness View Post
I thinnk the entire capitalism system is to blaim.
That's more or less like saying that humanity is to blame — true, but doesn't really get us anywhere.

It annoys me when people say we have to spend more to get out of the crisis on one end, and the environmental friends on the other side says like, we have to learn to consume less……
Both are right. There isn't even a contradiction there, you just have to look at the niggly details. We do have to spend more in the short term to get out of the crisis, but we have to learn to consume less in the long term to prevent it from recurring. The world economy is sort of like an obese guy who's dying of hypoglycemia — yes, he needs to learn to eat less in the long run, but if he doesn't get some sugars in his system right now, he'll die.

Second, there's the matter of *what* we need to consume less. Namely, natural resources. That doesn't preclude economic growth: it just means that we must learn to produce that economic growth with fewer inputs. For example, greater energy efficiency, more efficient recycling, and sustainable use of renewable resources.

It is contradictions, and given the state of the earth these days, consume less should win, which means we need another system not based on consumption!
You're making huge leaps to conclusions again. As usual. Once more: we do need to learn to consume less natural resources, but that's not the same at all as learning to consume less, full stop. You're not the only one confused about this distinction, though; it's a very common one that I believe is due to a lack of understanding about what economic growth actually is.
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February 18th, 2009, 12:34
Originally Posted by txa1265 View Post
It was very interesting to see Clinton on CNN disputing this. I mean, he oversees dismantling a regulation that led to the massive expansion of subprimes, yet only takes credit for the upsides? Nice try!

And yeah, I think perhaps Reagan … though there were enough signs and recessions (including a very deep late 80's one) that showed how to deal with the downsides of those policies that we might as well lump in everyone back through FDR to Herbert Hoover if we include Reagan …
Actually, no. Those problems were qualitatively different. The deep (but short) 1980's recession was intentionally created by Paul Volcker, by contracting the money supply. The intention was to wring inflation out of the system, thereby permitting stronger long-term growth. It worked.

The structural cause of the current mess is an unsustainable credit expansion that began as a direct consequence of Ronald Reagan's economic policy, better known as "trickle-down economics." Clinton's fault (and the fault of every administration since Reagan) lies in not doing anything to slow down or halt that credit expansion. Since Reagan, an ever-increasing proportion of your economic growth was driven by an expansion of consumer credit — in fact, pretty much *all* of the growth since the turn of the millennium was created this way, i.e., it was completely illusory; living on borrowed money.

IOW, Carter, Nixon, LBJ, JFK, Ike, Truman, or FDR had nothing to do with it. Their economic problems were qualitatively different, and there's no strong causal connection between what they did and what we're currently seeing.

OTOH there are strong similarities — although not causalities — between today's problems and the problems that Herbert Hoover faced.
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February 18th, 2009, 12:42
Why isn't the US Government up there, or Barney Frank, or the other people really responsible.

Under Clinton, banks were forced by the Gov to make at least 40% of their loans to people that couldn't pay them back. It's action->reaction. The more the government interferes with industry, the more that industry will be screwed up. If banks go from being rated on their ability to make smart decisions, to being rated on their ability to make bad loans, of course this is the outcome. Its funny that the same people that got us into this mess are the ones trying to get us out of it, by stimulating the economy by such smart measures as giving 4 billion to Acorn. Brilliant!

Of course the cult members will never see the truth of action leading to reaction, and blame the fault on anything and everything but the real reasons. But, hey, anything to hasten America's mad dash to destruction is worth it to the cult. Because diversity only counts for skin color, not opinion or types of governments the world is allowed to have.
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February 18th, 2009, 12:46
Originally Posted by Unrestigered View Post
Under Clinton, banks were forced by the Gov to make at least 40% of their loans to people that couldn't pay them back.
That's complete nonsense, of course, although it does get repeated a lot in wingnut blogs.
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February 18th, 2009, 13:31
So Clinton didnít appoint Cuomo (a purely political appointment since Cuomo had no qualifications). Cuomo didnít institute, through the Government, kick-backs to banks that made the most bad-loans to people who had no way of paying the loans off. And I guess Fanny Mae and Freddy Mac werenít told to buy up those bad loans. And I guess this never happened either:
http://www.youtube.com/watch?v=hxMInSfanqg

If you actually have it in you to open your mind enough to watch it, weíll see what you have to say.
Now listen to Barneyís rhetoric today. Itís insane.
40% bad loans to get kick-backs from HUD had nothing to do with the issues of today. Clinton never appointed Cuomo. The truth is lies, there is only the Truth. The cult supports the Truth, and the Truth overrides truth.
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February 18th, 2009, 14:23
I blame this guy
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February 18th, 2009, 14:52
Originally Posted by GothicGothicness
I thinnk the entire capitalism system is to blaim.
That's more or less like saying that humanity is to blame — true, but doesn't really get us anywhere.
You mean there was never another system besides capitalism? or you blaim it on that it is in the human nature to want more ?? I think it is the capitalism that makes us want more and more, to own stuff we never needed for any reason is a symbol of status in capitalist society, it does not have to be like this, at least according to your beliefs that culture of benefit could shape the human being away from its nature.

Both are right. There isn't even a contradiction there, you just have to look at the niggly details. We do have to spend more in the short term to get out of the crisis, but we have to learn to consume less in the long term to prevent it from recurring. The world economy is sort of like an obese guy who's dying of hypoglycemia — yes, he needs to learn to eat less in the long run, but if he doesn't get some sugars in his system right now, he'll die.

Second, there's the matter of *what* we need to consume less. Namely, natural resources. That doesn't preclude economic growth: it just means that we must learn to produce that economic growth with fewer inputs. For example, greater energy efficiency, more efficient recycling, and sustainable use of renewable resources.
Is it really, I disagree, I believe we need to change the economical system to one that is not consumption based. I do not think as long as we have a consumption based system that we could reach the environmental goals.

You're making huge leaps to conclusions again. As usual. Once more: we do need to learn to consume less natural resources, but that's not the same at all as learning to consume less, full stop. You're not the only one confused about this distinction, though; it's a very common one that I believe is due to a lack of understanding about what economic growth actually is.
This is very relative? what can we consume which is not in some way natural resources, yes we can change our consupmtion to consume something which needs less natural resources to produce, and that could be recycled from other things we already made, but I don think we will find a perfect process of recycling even 1000's of years from now of reserch when it would already be too late, on top of that to get things we need to transport them.

But if you think we could easily consume more or on the same level and still save the environment because we could get eco friendly products quickly and effectively right now. You have a stronger belief in the science of today than I have.
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February 18th, 2009, 15:26
Originally Posted by GothicGothicness View Post
You mean there was never another system besides capitalism? or you blaim it on that it is in the human nature to want more ?? I think it is the capitalism that makes us want more and more, to own stuff we never needed for any reason is a symbol of status in capitalist society, it does not have to be like this, at least according to your beliefs that culture of benefit could shape the human being away from its nature.
Nope, that's not what I'm saying. However, I am saying that none of the other systems we've tried were any better.

Is it really, I disagree, I believe we need to change the economical system to one that is not consumption based. I do not think as long as we have a consumption based system that we could reach the environmental goals.
Consumption of what? Non-renewable natural resources? Absolutely. Renewable natural resources in unsustainable ways? Totally. Consumption of everything? Nonsense.

This is very relative? what can we consume which is not in some way natural resources, yes we can change our consupmtion to consume something which needs less natural resources to produce, and that could be recycled from other things we already made, but I don think we will find a perfect process of recycling even 1000's of years from now of reserch when it would already be too late, on top of that to get things we need to transport them.
We can consume renewable natural resources at or below the rate at which they are renewed. The thing you're missing is that natural resources are one input of the stuff we actually end up consuming. The other inputs are labor, capital, and creativity. They're all renewable resources. In other words, it's perfectly possible to have a consumption-oriented society that recycles its non-renewable natural resources and uses its renewable natural resources at a sustainable pace, by plugging the gap with labor, capital, and creativity. And I believe that that's where we should be going.

But if you think we could easily consume more or on the same level and still save the environment because we could get eco friendly products quickly and effectively right now. You have a stronger belief in the science of today than I have.
Not right now, obviously. But in 10, 20, or 30 years, if we put our mind to it, for sure. The European ecological footprint is only about twice as big as it should be to achieve sustainability. I'm quite certain that we can find a way to cut it in half without materially affecting our standard of living, if we set our minds to it.
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February 18th, 2009, 15:34
Originally Posted by Unrestigered View Post
So Clinton didnít appoint Cuomo (a purely political appointment since Cuomo had no qualifications). Cuomo didnít institute, through the Government, kick-backs to banks that made the most bad-loans to people who had no way of paying the loans off. And I guess Fanny Mae and Freddy Mac werenít told to buy up those bad loans.
Even if he did, it can't have anything to do with the current mess.

The reason is real simple: the banking collapse is due to credit derivatives going bad, and the credit derivative market when Clinton was in power was insignificantly small. Fannie and Freddie got into that business much later. Loans issued under the Community Reinvestment Act aren't the ones going bad; loans issued during the credit derivative frenzy are.
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February 18th, 2009, 15:49
Consumption of what? Non-renewable natural resources? Absolutely. Renewable natural resources in unsustainable ways? Totally. Consumption of everything? Nonsense.
Ok deal, literally if you breath you could also call it consumption of air.

I will call the kind of consumption we are talking about (MA) consumption.

labor, capital, and creativity.
capital as in money?

Creativity? yes if you tell a story by word of mouth you do not consume any ( close to any ) natural resources, we could consume more stories instead of watching TV that would save power and material to build TV's an excellent idea.

Labor ? Is it the labour we consume or the things produced by the labour ? what labour does not require materials to work with, for example someone who carries stuff which are too heavy for you to carry so you do not need a car to transport them, another excellent idea.

I guess we had a different idea of the meaning of the word consumption in this context.

China has so much labour, but just not anything to use it for, acctually we have a big surplus of labour in many countries. It is ironic that in many cases man labour is cheaper than machine work in china.

Not right now, obviously. But in 10, 20, or 30 years, if we put our mind to it, for sure. The European ecological footprint is only about twice as big as it should be to achieve sustainability. I'm quite certain that we can find a way to cut it in half without materially affecting our standard of living, if we set our minds to it.
That is very optimistic, but what about the people in india and China, and Africa who want the same standard as us ? If we do not lower our (MA) consumption more than half, how can we request of them to not get the same level as us ?
Last edited by GothicGothicness; February 18th, 2009 at 16:05.
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February 18th, 2009, 16:12
As opposed to dismissing the point as "complete nonsense" from "wingnut blogs" and then coming back and noting that the circumstances are by-n-large accurate, meaning that the only flaw is a different (and not automatically errant) interpretation of those circumstances?

Sorry. No pearls of wisdom in this oyster.
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February 18th, 2009, 16:22
If you're talking to me, I deleted my post because I disliked my own tone of superiority as much as Mr Unregistered's.

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February 18th, 2009, 16:24
Originally Posted by GothicGothicness View Post
Creativity? yes if you tell a story by word of mouth you do not consume any ( close to any ) natural resources, we could consume more stories instead of watching TV that would save power and material to build TV's an excellent idea.
Watching a TV show would actually be an example of consumption that doesnt use too many resources. On the marginal you only use electricity (which can be generated in fairly harmless ways). The whole digitalisation of society offers an opportunity to move from raw materials to energy consumption.

You arguably use less resources when you buy music from Itunes or whatever than back when you bought physical CDs, but does it mean you "consume less" in by any sensible definition?

Originally Posted by GothicGothicness View Post
Labor ? Is it the labour we consume or the things produced by the labour ? what labour does not require materials to work with, for example someone who carries stuff which are too heavy for you to carry so you do not need a car to transport them, another excellent idea.
Broadcasting 100 TV shows doesnt really require much more raw material than the first one.

Originally Posted by GothicGothicness View Post
I guess we had a different idea of the meaning of the word consumption in this context.
You assume a fairly narrow and simple definition of consumption.
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February 18th, 2009, 16:34
Originally Posted by GothicGothicness View Post
You mean there was never another system besides capitalism? or you blaim it on that it is in the human nature to want more ?? I think it is the capitalism that makes us want more and more, to own stuff we never needed for any reason is a symbol of status in capitalist society, it does not have to be like this, at least according to your beliefs that culture of benefit could shape the human being away from its nature.
To reference Churchill, Capitalism is like Democracy. It's the absolutely worst economic system, except all of the others we've tried.

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February 18th, 2009, 16:38
Originally Posted by Prime Junta View Post
Even if he did, it can't have anything to do with the current mess.

The reason is real simple: the banking collapse is due to credit derivatives going bad, and the credit derivative market when Clinton was in power was insignificantly small. Fannie and Freddie got into that business much later. Loans issued under the Community Reinvestment Act aren't the ones going bad; loans issued during the credit derivative frenzy are.
Umm, the banking collapse is due to far more than credit derivatives, but even so Clinton signed the Commodity Futures Modernization Act, which exempted credit-default swaps from regulation.

In 1995 Clinton loosened housing rules by rewriting the Community Reinvestment Act, which put added pressure on banks to lend in low-income neighborhoods.
Low-income leads to low probability to repay. And where do you find that these aren't the loans going bad? The communities targeted by this act are getting hit awfully hard right now.

Clinton also successfully pushed for Freddie and Fannie to start buying more and more risky mortgages.

I'm not blaming it all on Clinton by any means, but to say he had nothing to do with the current mess is patently dishonest.

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February 18th, 2009, 18:02
Bah. Blame Clinton, and to hell with the details.

Sorry. No pearls of wisdom in this oyster.
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