Should Government That Twisted Markets Own Banks?

Great letter-to-the-editor in the Wall Street Journal Saturday, February 28, 2009

Should Government That Twisted Markets Own Banks?
"The Weekend Interview with Nouriel Roubini: 'Nationalize' the Banks" (Feb. 21) once again demonstrates that the credibility of economists is inversely related to their level of celebrity and their proximity to political power. To paraphrase Lord Acton: Celebrity corrupts, and political celebrity corrupts absolutely. Mr. Roubini tells us that markets fail and have failed to clear because of excesses, greed and irrational exuberance.

Amazingly, Mr. Roubini makes no mention whatsoever of the government interventionism that is largely the cause of our current crisis. Was the Federal Reserve's policy of holding interest rates below the real rate of interest and thereby causing a credit bubble and debt-fueled consumption a market failure? Or was the market failure that market participants did not read F.A. Hayek's "Monetary Theory and the Trade Cycle" and divine the peril that was not being signaled through the price mechanism? Or does Mr. Roubini consider it a market failure that lenders were coerced by the government to make mortgage loans that never would have been made based on market-driven underwriting standards? Is the failure of unqualified homebuyers to decline the cheap, no-down-payment loans that lenders were coerced to offer them another market failure? Was it market failure that lenders knew they would never have to suffer the consequences of reckless underwriting when they could dump their rotten portfolio on the taxpayers via the government-backed Fannie Mae and Freddie Mac?

Robert Drane
Lakewood Ranch, Fla.

Let’s Bet on Humans Existing in 2018

Letter writer wrote “The present level of population density and carbon-based industrialization is producing an exponential increase in the average world wide temperature, which, if not dramatically reduced over the next decade will lead to an environmental disaster that human-kind is unlikely to survive.” LB Independent November 23, 2007

Michelle Obama View of U.S.

"I don't lose sleep over it, because the realities are that, you know, as a black man, you know, Barack can get shot going to the gas station, you know. So, you know, you can't -- you know, you can't make decisions based on fear and the possibility of what might happen."
Michelle Obama Feb 11, 2007, CBS 60 Minutes