Friday, May 25, 2012

Krugman vs. Bobo

It's not much of a contest. Earlier this week, David "Bobo" Brooks explained to the masses why financial buccaneering saved the world starting back during the Presidency of St. Reagan in How Change Happens New York Times 05/21/2012.

Charlie Pierce, lately the leftweb's go-to guy for regular fisking of Bobo's columns, laid it out for us with some assistance from Bobo's Irish setter Moral Hazard in Our Mr. Brooks Goes A'Bain-ing for a Changeling Esquire Politics Blog 05/22/2012.

In BoboLand, here's why financial scamsters are our salvation:

Forty years ago, corporate America was bloated, sluggish and losing ground to competitors in Japan and beyond. But then something astonishing happened. Financiers, private equity firms and bare-knuckled corporate executives initiated a series of reforms and transformations.

The process was brutal and involved streamlining and layoffs. But, at the end of it, American businesses emerged leaner, quicker and more efficient.
And on and on with blah, blah, blah about how anything that makes the rich richer is good no matter what happens to everyone else.

Now, it appears that the New York Times has some policy about their regular columnists criticizing each other directly. So it's always fun to see how Paul Krugman goes about rebutting various egregious nonsense that Bobo puts out there. His latest forays in BoboLand is Egos and Immorality New York Times 05/24/2012:

... let me take a moment to debunk a fairy tale that we’ve been hearing a lot from Wall Street and its reliable defenders — a tale in which the incredible damage runaway finance inflicted on the U.S. economy gets flushed down the memory hole, and financiers instead become the heroes who saved America.

Once upon a time, this fairy tale tells us, America was a land of lazy managers and slacker workers. Productivity languished, and American industry was fading away in the face of foreign competition.

Then square-jawed, tough-minded buyout kings like Mitt Romney and the fictional Gordon Gekko came to the rescue, imposing financial and work discipline. Sure, some people didn’t like it, and, sure, they made a lot of money for themselves along the way. But the result was a great economic revival, whose benefits trickled down to everyone.

You can see why Wall Street likes this story. But none of it — except the bit about the Gekkos and the Romneys making lots of money — is true.

For the alleged productivity surge never actually happened. In fact, overall business productivity in America grew faster in the postwar generation, an era in which banks were tightly regulated and private equity barely existed, than it has since our political system decided that greed was good.
Poor Bobo. Even his imaginary Irish setter knows he's a hack, although one undoubtedly talented at putting Republican talking points in calm, reassuring terms and tones. So you can almost feel sorry for him facing Krugman explaining that, no, Bobo, there was no productivity surge. No leap in international competitiveness. And certainly no trickle-down.

Bobo should stick to worrying about the social habits of Appleby's diners and the sex habits and TV preferences of trailer-park dwellers.

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