Thursday, November 29, 2012

We are warm blooded, we are legion

Some people on the left are alarmed that Treasury Sec Timothy Geithner is leading negotiations to deal with the Fiscal Cliff (or the Fiscal Bunny Slope) being held between the Obama Adm and the Congress. Okay, he wouldn't be my pick, but he does have the expertise and the staff to deal with it.

Let's clear up a couple of things, Geithner never worked for a Wall Street bank. He was Governor of the NY Fed, which is largely responsible for riding herd on the the Wall Street banks, but that business was completely out of control before he got the job.

Now this doesn't prove anything one way or another, but Geithner was simultaneously on the board of the Bank of International Settlements (BIS). It was this body that pulled the plug on the Wall Street banks transferring money between banks in 2008 over their involvement in the selling of a quadrillion dollars ($1,000,000,000,000,000) worth of un-backed derivatives. This effectively froze the US banking system overnight. John McCain was caught completely flat footed by this move. He said when reporters asked him about the imminent end of Western Civilization, "the fundamentals of the economy are sound". Obama was not caught off guard, even though Obama has no experience or training in banking or economics. He seemed completely comfortable talking about it, just like he had been briefed. He did make Geithner Sec of the Treasury, typically a plum appointment given to an ally.   

Okay, even if Geithner can't be trusted, Obama's Chief of Staff Jack Lew is himself an economist with experience in banking. He's also worked at the State Department, the Council of Foriegn Relations, Office of Management and Budget, and several other jobs that suggest that he's nobody's fool. He is also expected to replace Geithner in Obama's second term.

Anything that happens over the budget negotiations will be with Obama's full understanding. Even if Obama "gives in" to Republican demands for cuts, it's the timing you need to look at. If the 'cuts' are put in far down the road, they are like no cuts at all. Anything done now can be undone by any future Congress, good or bad. Since the Republicans are just a bunch of dinosaurs waving their tiny arms in the air as the asteroid approaches, we liberal mammals need not panic. If we stick together we will prevail.


Dave said...

I remember in grade school when I learned about quadrillions. Then again I'm old enough that they were teaching about numbers in school when I was there.

Of course the really good part about quadrillions of dollars is that they only exist because we say they do. Given the right circumstance or societal collapse, a quadrillion dollars won't have any meaning let alone value. Now a case of cans of spicy chili, that has value!

Roman Law said...

It's funny to see how most Republicans continue to shovel sand over their heads as they dig in ever deeper about their demands for unconditional budget cuts and no revenue increase on the wealthy.

What they don't seem to realize as they dig is that Obama handed them their own "shovel ready" project except this one won't build anything for them.