19 March 2013

Profiles in Economic Stupidity of Breathtaking Proportions

Allow me to refer to two recent examples of unbridled stupidity in the field of public economics. The details are all over the internet tubes, so I will spare you.

1.  The Ryan Budget, with its mendacious and clearly deliberate fictionalization of future revenue, its wanton and churlish disregard for the vital importance to the health of the economy of a functioning social safety net, and its absolutely disgusting pandering to the narrow (perceived) interests in preservation of the wealth and unearned privilege of the super-rich. (None of that is even slightly exaggerated, in my humble opinion).

2.  The Finance ministers in Brussels, Berlin, and the ECB, who actually (apparently) thought it was a good idea, probably because it was a far corner that wasn't even really in Europe, to tax savings deposits of banks inside the Eurozone (Cyprus), thus making a mockery of deposit insurance (which they learned from Depression era America to begin with). This unbelievable stupidity now has the very real prospect of unraveling the Eurozone financial system entirely, just when the world markets had more or less concluded that they just might muddle through. This despite a whole host of previous stupid decisions (but this one really takes the cake!). Just pray that North America's economy is sufficiently integrated and independent of Europe's that it doesn't crash our economy too; or that they somehow manage to blunt or at least partly reverse this idiocy before the worst of the damage becomes irreversible. 

Needless to point out, I suppose, is the fact that the second example is far worse than the first, if for no other reason than that the "Ryan Budget" is and always was a work of fiction, which will go nowhere and have little or no effect on policy, whereas the incredible recklessness of the Eurozone finance dictators has already caused enormous damage, and has a huge potential to wreak havoc worldwide. Stay tuned. I wish I could say they will probably fix this once they see what's happening, but if past is prelude, there's no reason to think that. 

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