Truth in Time

Justin Fox is the economics columnist for Time magazine. I’ve has a subscription to Time for the better part of 25 years. I still recommend it for those with limited time to keep abreast of the news. Which is just about anybody.

Mr. Fox had a particularly good article last week and I thought I share some of it with you.

”But it's also clear that the authorities--then Treasury Secretary Hank Paulson, in particular--didn't want to intervene. The Fed and Treasury had taken a lot of flak for their earlier bailouts of Bear Stearns, Fannie Mae and Freddie Mac. It was time to let the market work.

Within days of Lehman's failure, it was apparent that the market wasn't up to the task.“

With only a year's history to clarify the situation, it has become stunningly clear that the Free Marketeers were wrong. And yet, they persist.


”"I've abandoned free-market principles to save the free-market system" is how President George W. Bush described it last December.

Mission accomplished--so far, at least. In the face of a financial shock probably worse than the stock-market crash of 1929, massive government intervention averted a second Great Depression. “

And still, the Free Marketers persist. “Just get out of the way and let the market work”, they say. “Too much government”. “Socialists”.

”By leaving financial markets alone, Mellon (Herbert Hoover’s Secretary of the Treasury) and his kindred spirits at the Fed ushered in an economic collapse that led to permanent government intervention in the financial sector. By intervening, Paulson and his kindred spirits at the Fed seem to have headed off a re-enactment of the New Deal. “

Some might think I’m rooting for the death of the Republican Party. Far from it. I believe in checks and balances. But those checks and balances must be based on reality.

”Obama's talk at the U.N. was well received all over the world, except in the right-wing stratosphere in the United States. There he was accused of selling out America, mounting a coup against the country, siding with dictators, and wishing America would perish. If you heard or read the speech, you would be hard pressed to find a single words that Obama said that fits these descriptions.

But that is the nature of political attacks in America these days. They are totally divorced from reality.“

That was what I heard on Fareed Zakaria’s GPS last Sunday.

The Republican Party is wrong about the economy, foreign affairs and they are wrong about health care too. Think about it for just a minute without distraction. You know that every other civilized country in world has some form of universal health care or insurance. Think about the United Kingdom for a second -- they of the Great Bugaboo for the Republicans -- with a system that really is “socialized medicine”. For argument’s sake, let’s say they are totally misguided socialists that are just flat wrong. So how is it that they live longer than us ? They are more like us than any other nation on Earth -- except maybe the Canadians and the Canadians live longer than the English. Yet we spend twice as much money as the U.K.

Doesn’t that -- in the American way of thinking -- mean that our health care ought to be twice as good as theirs ? That is what the Free Market is all about, right ? You get what you pay for ? Is there anybody that thinks our health care is twice as good ? The situation is actually worse than even that would indicate. The U.K. covers everybody. America doesn’t. The U.K. covers everybody for less than half of what we pay to cover everybody minus 40-50 million citizens. If “socialized medicine” is worse, how come it’s better ?

Let’s think like a dedicated Free Marketeer. You know, the ones that love to talk about efficiency, how the Free Market is the cat’s meow and contract out everything in sight.

Let’s contract out the U.S. health care system to the U.K. Government. We could cover everybody in America and still save a bundle of money. Hey ! If we can contract out the U.S. ATC system to a foreign government we can contract out our health care system, right ?

”In 2004, Airservices was awarded contracts to provide tower air traffic control management for the FAA at towers in Hawaii (John Rogers Field, an Air National Guard airport in Kalaeloa), Keahole-Kona, Lihue and Molokai and at towers in Guam and Saipan - the major airports on these Pacific islands.“

Don Brown
September 28, 2009