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Friday, October 07, 2011

Paul Krugman: Confronting the Malefactors

"How can you not applaud the protesters for finally taking a stand?":

Confronting the Malefactors, by Paul Krugman, Commentary, NYTimes: There’s something happening here. What it is ain’t exactly clear, but we may, at long last, be seeing the rise of a popular movement that, unlike the Tea Party, is angry at the right people. ... Occupy Wall Street is starting to look like an important event that might even eventually be seen as a turning point.
What can we say about the protests? First things first: The protesters’ indictment of Wall Street as a destructive force, economically and politically, is completely right.
A weary cynicism, a belief that justice will never get served, has taken over much of our political debate... In the process, it has been easy to forget just how outrageous the story of our economic woes really is. So, in case you’ve forgotten, it was a play in three acts.
In the first act, bankers took advantage of deregulation to run wild (and pay themselves princely sums), inflating huge bubbles through reckless lending. In the second act, the bubbles burst — but bankers were bailed out by taxpayers, with remarkably few strings attached, even as ordinary workers continued to suffer the consequences of the bankers’ sins. And, in the third act, bankers showed their gratitude by turning on the people who had saved them, throwing their support — and the wealth they still possessed thanks to the bailouts — behind politicians who promised to keep their taxes low and dismantle the mild regulations erected in the aftermath of the crisis.
Given this history, how can you not applaud the protesters for finally taking a stand? ... It would probably be helpful if protesters could agree on at least a few main policy changes they would like to see enacted. ... Rich Yeselson, a veteran organizer and historian of social movements, has suggested that debt relief for working Americans become a central plank of the protests. I’ll second that, because such relief, in addition to serving economic justice, could do a lot to help the economy recover. I’d suggest that protesters also demand infrastructure investment — not more tax cuts — to help create jobs. Neither proposal is going to become law in the current political climate, but the whole point of the protests is to change that political climate.
And there are real political opportunities here. ... Democrats are being given what amounts to a second chance. The Obama administration squandered a lot of potential good will early on by adopting banker-friendly policies that failed to deliver economic recovery even as bankers repaid the favor by turning on the president. Now, however, Mr. Obama’s party has a chance for a do-over. All it has to do is take these protests as seriously as they deserve to be taken.
And if the protests goad some politicians into doing what they should have been doing all along, Occupy Wall Street will have been a smashing success.

    Posted by on Friday, October 7, 2011 at 12:24 AM in Economics | Permalink  Comments (81)


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