How Democracy Ruined the Bailout

[Lexington]

Source: Wall Street Journal

Woulda, coulda, shoulda, despite being a reputational black hole, can be educational.

Never was it a good idea to have a financial crisis in the middle of a presidential election. Involving Congress was a mistake. Letting the technical matter of keeping the banks afloat become a political football was a terrible idea. Letting our willingness to deploy giant sums of taxpayer money become the measure of credibility was a disaster. Letting all this be sold on Capitol Hill amid shrieks about the country collapsing into a Second Great Depression was a confidence killer across the economy, which until that point had held up well.

It's possible in hindsight to imagine a better course. Had matters simply been left in the hands of the Federal Reserve and fellow bank regulators, the "crisis" might have become fodder for little more than future late-night reminiscences by retired bureaucrats, pleasuring themselves with how closely the world came to burning down without the public ever knowing it.

Their efforts wouldn't have spared us a recession, perhaps a deep recession. But one mistake has been the degree to which recession-fighting has gotten mixed up with the system-bracing that should have been the preoccupation of the technocrats, with the less said to the broader public the better.

A rational, not political, approach would also have latched on early to the striking fact that much of the subprime crisis stemmed from just a handful of fast-growing counties in four states where housing prices zoomed then plummeted.

Looking back, the biggest mistake was the original Troubled Asset Relief Program -- not the idea itself, but because it required Congress's participation. Giant appropriated sums were never necessary, except perhaps by the screwy reasoning that banks had to be made to lend again for antirecession purposes.

The Fed and FDIC, formally or informally, had already guaranteed the deposits and other liabilities of the banks. Bank runs were off the table, so even if banks were technically insolvent, they could stay in business and have an opportunity to earn their way out of trouble. Withdrawal of investor support for the securitization of credit-card loans, auto loans and jumbo mortgages does present a big and somewhat related challenge (one the Fed is addressing), but otherwise the economy is not being starved for bank credit.

On the contrary, month after month, the National Federation of Independent Business, the authoritative small business trade group, has reported deepening pessimism among its members -- and yet no credit crunch. "Fewer loans are being made, but a substantial share of the decline is due to lower demand, not problems on the supply side," the group reported along with its just-released January survey.

The dynamics of our rapidly decelerating economy are not a mystery. Fear begets fearful actions. Employers cut costs and refrain from hiring. House shoppers pull back. What were good credit-card loans on bank balance sheets become bad ones. Good mortgages turn into bad ones. Nobody wants to buy a car, so auto jobs are lost.

To blame politicians is at once churlish and unavoidable. Nobody really is in control of the dynamic. Economists and philosophers talk about "path dependency" -- how a small act can shunt events onto one path or another, producing a cascade of consequences that were far from inevitable.

Ben Bernanke and Henry Paulson, in a phone call last Sept. 17, decided to involve political actors in the bailout following the Lehman debacle. They had good, legal, democratic and constitutional reasons for doing so, but it was a terrible mistake.

With perfect foresight, Mr. Paulson might have put his foot down and said, "No. We will solve this ourselves, even if it means stretching our powers beyond every precedent." After all, the Fed, Treasury, FDIC, and Fannie and Freddie (which by then were under Treasury control) jointly represented a set of tools, and balance sheets, that could credibly have stood behind just about any guarantee the two men chose to issue against further Lehman-like bankruptcies of important financial firms.

Let Congress complain about their actions after the fact. Avoided would have been the Pandora's Box of trying to politicize the delicate job of maintaining confidence in the financial system.

Harry Truman "scared hell" out of the country to get it ready to support a multigenerational facing-down of the Soviets. Scaring hell out of the economy, begun by President Bush and continued by President Obama, has produced only the runaway crisis it was advertised to prevent.

Ou comment les hommes politiques amplifient les crises, encore d'une autre manière.

[Zax]

Tu as un lien pour l'avoir en Français stp ? C'est vrai que faire de l'anglais ça fait de mal à personne mais tout le temps, ça devient lourd.

[h16]

http://translate.google.com/translate?prev…history_state0=

Woulda, Coulda, Shoulda, en dépit de la réputation d'être un trou noir, peut être éducatif.

Il n'a jamais été une bonne idée d'avoir une crise financière au milieu d'une élection présidentielle. Involving Congress was a mistake. La participation des Congrès a été une erreur. Letting the technical matter of keeping the banks afloat become a political football was a terrible idea. Laisser la question technique de garder les banques à flot devenu un ballon de football politique a été une terrible idée. Letting our willingness to deploy giant sums of taxpayer money become the measure of credibility was a disaster. Laisser notre volonté de déployer géant des sommes d'argent des contribuables devenir la mesure de la crédibilité a été une catastrophe. Letting all this be sold on Capitol Hill amid shrieks about the country collapsing into a Second Great Depression was a confidence killer across the economy, which until that point had held up well. Laisser tout cela est vendu sur la colline du Capitole au milieu des cris sur le pays de s'effondrer dans une deuxième grande dépression était un tueur de confiance dans l'économie, qui jusqu'à ce point, a tenu bon.

It's possible in hindsight to imagine a better course. Il est possible que le recul d'imaginer un meilleur cap. Had matters simply been left in the hands of the Federal Reserve and fellow bank regulators, the "crisis" might have become fodder for little more than future late-night reminiscences by retired bureaucrats, pleasuring themselves with how closely the world came to burning down without the public ever knowing it. Questions avaient été tout simplement laissé dans les mains de la Réserve fédérale de réglementation bancaire et boursier, la "crise" aurait pu devenir le fourrage pour l'avenir un peu plus de souvenirs de fin de soirée à la retraite les bureaucrates, avec plaisir eux-mêmes à quel point le monde est venu à brûle sans le public le sache jamais.

Their efforts wouldn't have spared us a recession, perhaps a deep recession. Leurs efforts ne nous ont épargné une récession, peut-être une profonde récession. But one mistake has been the degree to which recession-fighting has gotten mixed up with the system-bracing that should have been the preoccupation of the technocrats, with the less said to the broader public the better. Mais une erreur a été la mesure dans laquelle la lutte contre la récession s'est mélangé avec le système d'arrimage qui aurait dû être la préoccupation de la technocratie, en dit le moins pour le grand public le mieux.

The Opinion Journal Widget L'avis Journal Widget

Download Opinion Journal's widget and link to the most important editorials and op-eds of the day from your blog or Web page. Télécharger le Journal de l'avis des widgets et un lien vers le plus important des éditoriaux et des tribunes libres de la journée à partir de votre blog ou votre page Web.

A rational, not political, approach would also have latched on early to the striking fact that much of the subprime crisis stemmed from just a handful of fast-growing counties in four states where housing prices zoomed then plummeted. Rationnel, et non politique, l'approche aurait également la position de fermeture de la petite à la grève fait que beaucoup de la crise des subprimes découle d'une poignée de pays à croissance rapide dans les quatre États où les prix des logements a chuté puis agrandie.

Looking back, the biggest mistake was the original Troubled Asset Relief Program -- not the idea itself, but because it required Congress's participation. Rétrospectivement, la plus grande erreur a été à l'origine Troubled Asset Relief Program - pas l'idée elle-même, mais parce qu'il exige la participation du Congrès. Giant appropriated sums were never necessary, except perhaps by the screwy reasoning that banks had to be made to lend again for antirecession purposes. Giant ouvert sommes n'ont jamais été nécessaire, sauf peut-être par le raisonnement screwy que les banques ont dû être faits pour prêter à nouveau pour antirecession fins.

The Fed and FDIC, formally or informally, had already guaranteed the deposits and other liabilities of the banks. La Fed et de la FDIC, officiellement ou officieusement, a déjà garanti les dépôts et autres engagements des banques. Bank runs were off the table, so even if banks were technically insolvent, they could stay in business and have an opportunity to earn their way out of trouble. Banque gère étaient sur la table, même si les banques ont été techniquement en faillite, ils pourraient rester en affaires et avoir une chance de gagner à sortir de la difficulté. Withdrawal of investor support for the securitization of credit-card loans, auto loans and jumbo mortgages does present a big and somewhat related challenge (one the Fed is addressing), but otherwise the economy is not being starved for bank credit. Retrait de l'investisseur pour la titrisation de prêts de cartes de crédit, prêts-auto et des prêts hypothécaires ne jumbo présente un grand défi et un peu liés (une adresse de la Fed), mais l'économie ne sont pas privées de crédit bancaire.

On the contrary, month after month, the National Federation of Independent Business, the authoritative small business trade group, has reported deepening pessimism among its members -- and yet no credit crunch. Au contraire, mois après mois, la Fédération nationale de l'entreprise indépendante, l'autorité de petites entreprises commerciales du groupe, a rapporté l'approfondissement de pessimisme parmi ses membres - et pas encore de crédit. "Fewer loans are being made, but a substantial share of the decline is due to lower demand, not problems on the supply side," the group reported along with its just-released January survey. "Moins les prêts sont faits, mais une part importante de la baisse est due à une baisse de la demande, pas de problèmes du côté de l'offre», le groupe avec son tout nouveau Janvier enquête.

The dynamics of our rapidly decelerating economy are not a mystery. La dynamique de la décélération rapide de notre économie ne sont pas un mystère. Fear begets fearful actions. La peur engendre la peur actions. Employers cut costs and refrain from hiring. Les employeurs de réduire les coûts et de s'abstenir de l'embauche. House shoppers pull back. Maison acheteurs reculer. What were good credit-card loans on bank balance sheets become bad ones. Quelles sont les bonnes cartes de crédit des prêts à des bilans des banques deviennent mauvaises. Good mortgages turn into bad ones. Bonne hypothèques se transformer en mauvaises. Nobody wants to buy a car, so auto jobs are lost. Personne ne veut acheter une voiture, de manière automatique des emplois sont perdus.

To blame politicians is at once churlish and unavoidable. De blâmer les hommes politiques est à la fois grossier et inévitable. Nobody really is in control of the dynamic. Personne n'est vraiment en contrôle de la dynamique. Economists and philosophers talk about "path dependency" -- how a small act can shunt events onto one path or another, producing a cascade of consequences that were far from inevitable. Les économistes et les philosophes, les discours sur la "dépendance" - comment un petit acte de shunt événements sur un chemin ou d'une autre, la production d'une cascade de conséquences qui sont loin d'être inévitable.

Ben Bernanke and Henry Paulson, in a phone call last Sept. 17, decided to involve political actors in the bailout following the Lehman debacle. Ben Bernanke et Henry Paulson, dans un appel téléphonique 17 septembre dernier, a décidé d'associer les acteurs politiques dans le renflouement la suite de la débâcle de Lehman. They had good, legal, democratic and constitutional reasons for doing so, but it was a terrible mistake. Ils avaient de bonnes, juridique, démocratique et constitutionnelle des raisons pour le faire, mais il a été une terrible erreur.

With perfect foresight, Mr. Paulson might have put his foot down and said, "No. We will solve this ourselves, even if it means stretching our powers beyond every precedent." En prévision parfaite, M. Paulson pourrait avoir mis le pied et a dit: "Non, nous allons résoudre nous-mêmes, même si cela signifie que nos compétences s'étendent au-delà de tous les précédents." After all, the Fed, Treasury, FDIC, and Fannie and Freddie (which by then were under Treasury control) jointly represented a set of tools, and balance sheets, that could credibly have stood behind just about any guarantee the two men chose to issue against further Lehman-like bankruptcies of important financial firms. Après tout, la Fed, du Trésor, la FDIC, et de Fannie et Freddie (qui étaient alors sous le contrôle du Trésor) ont représenté un ensemble d'outils, et du bilan, qui pourrait avoir crédible était juste derrière aucune garantie sur les deux hommes ont décidé d'émettre contre de nouvelles faillites de Lehman, comme d'importantes sociétés financières.

Let Congress complain about their actions after the fact. Laissez Congrès se plaignent de leurs actions après le fait. Avoided would have been the Pandora's Box of trying to politicize the delicate job of maintaining confidence in the financial system. Éviter aurait été la boîte de Pandore d'essayer de politiser la délicate tâche de maintenir la confiance dans le système financier.

Harry Truman "scared hell" out of the country to get it ready to support a multigenerational facing-down of the Soviets. Harry Truman "peur enfer» à l'extérieur du pays pour obtenir qu'il soit prêt à soutenir un face-à multigénérationnelles des Soviétiques. Scaring hell out of the economy, begun by President Bush and continued by President Obama, has produced only the runaway crisis it was advertised to prevent. Effrayer l'enfer de l'économie, entamé par le président Bush et a continué par le président Obama, n'a produit que l'emballement de crise a été annoncé il de prévenir.

C'est crado, mais ça donne une idée.

[Zax]

http://translate.google.com/translate?prev…history_state0=

C'est crado, mais ça donne une idée.

Merci . Mais je pense jamais à google trad en fait, tellement c'est mauvais. Ca traduit bien un mot ou une phrase courte et basique, mais ça va pas plus loin.

[john_ross]

Parce que vous croyez que si on avait la version traduite en français on se passerai de poster le lien?