Why do I like Matt Yglesias’s posts? Consider 5 done in the past few days:
BTW, Has anyone asked Warren Buffett if he plans to advocate ending the horrible laws that protect car dealers from competition? (Like those car dealers he just bought.) Or whether he intends to support the dealers so he can accumulate even more billions of dollars by ripping off ordinary Americans? He seems more honest and idealistic than the average Ukrainian oligarch, but it’d be nice to know for sure. And don’t even ask about the “free market loving” GOP.
But streetcars look neat . . . kinda European.
I really, really, really dislike publishers.
Surely the Dems would not incite racial fears for selfish electoral reasons?
After the 2008 crisis just about everyone on the left blamed it on “deregulation.” (Wait, if banking was deregulated then why did I have to sign 20 consumer protection forms every time I refinanced in the early 2000s?) I pointed out that the regulators also missed the crisis, so what makes us think they would do any better the second time around? My liberal friends replied that we now know the evils flowing from unrestrained lending to people who couldn’t possibly repay their mortgages. But that seemed like too low a bar to me, closing the barn door after the horse had left.
Sure, now it’s obvious that subprime loans were a disaster. But if the banks had known that in 2004-06 they obviously wouldn’t have made those bad loans, and they would have also refrained from investing in MBSs
MSEs. Yes, regulators have learned their lesson, but so have banks! Banks are also tightening up on their standards. So I ask again, what makes us think regulators could do any better next time? And isn’t it setting an excessively low bar to merely have regulators prevent an exact repeat of what went wrong in the 2006 housing bubble? Anybody could do that!
Well I should have saved my breath, for as Yglesias points out the bar might have been set way too low, but the regulators still couldn’t clear it. While banks have tightened their standards, regulators have returned to encouraging subprime mortgages. And this occurred under a supposedly
pre-regulation pro-regulation liberal Democratic president. If regulation doesn’t work now, how is it supposed to work under the next GOP president? Maybe Paul Krugman can tell us.
Krugman mocks conservatives who predicted inflation, and still insist the real problem is easy money. And rightly so. But I’d say the same about any liberal blogger who still thinks “deregulation” was the cause of the 2006 bubble. If they haven’t learned by now that our regulators are utterly incompetent, then they never will. Those progressives should be mocked in exactly the same way Krugman mocks conservatives who still insist the Fed’s “easy money” policy will soon create inflation.
PS. I like the way Reason.com defined the new policy: “Insanity defined.”
PPS. I wish Kevin Drum the best. I’ve never met him, but based on his writing he seems like a great guy.