Economic Darwinism

Modern-Day American Hero: Anna Schwartz

Posted in America, Anna Schwartz, Hero by Economic Darwinism on May 30, 2009

This short post will in no way suffice to communicate the high regard I have for Anna Schwartz. She is a true modern-day American hero.

It is a rare treat for her to make public comments, so I am especially pleased to point out two recent appearances:

Guy Sorman
Monetarism Defiant
Legendary economist Anna Schwartz says the feds have misjudged the financial crisis.

and

3rd Hour Special Edition with Eric King & Guests
Select an Audio Format – Part 1
RealPlayer | WinAmp | Windows Media | Mp3
Dr. Anna Schwartz, Economist

Letter to Obama: The Audacity of Hope Squandered

Posted in Anna Schwartz, Bernanke, Confidence, Geithner, Greenspan, Hope, Obama by Economic Darwinism on March 21, 2009

Every article here can be thought of as a letter directed to President Obama, but occasionally I will make the address explicit.

Dear Mr President,

The entire election process including the inauguration was a powerful experience for many people including myself. Clearly we all know that no one person holds all the answers to all the challenges that face us. The one thing that you offered that your rivals didn’t was Hope (with a capital “H”). The Audacity of Hope was a powerful message that resonated with millions not only within the US, but around the globe. We, the American people, need Hope now more than any time in most of our lifetimes.

I must tell you now because I care so deeply about this great country of ours that you are on the verge of squandering that Hope. If the Hope you brought into office with you is extinguished, I’m afraid that the next few years could become very bleak leading to even bleaker decades that could see our place in the world stage diminished substantially. The threat is real as you know better than anyone could.

You have only been in office for a short time. You’ve done a lot right, but you have also done a lot wrong. One very serious thing you’ve done wrong is to appoint Timothy Geithner to the Treasury. There are many exceptional candidates with the qualifications required to be Treasury Secretary. The actual qualifications of any nominee are, for the most part, irrelevant compared to the Confidence (with a capital “C”) they can inspire. Sadly, you must see it as plainly as day that Timothy Geithner does not inspire any Confidence. Confidence is a close cousin of Hope and as the former fades, that latter will soon follow.

You boldly admitted to screwing up (your words) with Tom Daschle, so why is it that you are not willing to admit that your appointment of Geithner was a mistake? A good argument could be made that Daschle was not a mistake and if you had withdrawn support for Geithner, it would have made it easier (or at least possible) to confirm Daschle.

It is not too late to have Geithner voluntarily resign. This country needs Hope and Confidence more than anything and we will not get that as long as Geithner remains at the Treasury.

At this moment in history, two institutions are at the center of the maelstrom: The Treasury and the Fed. Unfortunately, both of these institutions are failing us. When the history books are written, it will be hard to judge which of the two Fed chairman, Greenspan or Bernanke, did the most damage to our country. My suspicion is that when the anvil comes down, Bernanke will be found to be the guiltier of the two. Greenspan at least had some success early in his term. Bernanke has been a failure since day one and has only perpetuated the errors of his predecessor. His philosophy was challenged early by many admirable economists including the revered Anna Schwartz. If you want to know who should be Fed chairman, ask Anna Schwartz. She is the wisest person on the planet right now and we should value anything that she is willing to offer while we still have her with us.

You gave us the audacity to Hope. The only thing more audacious than Hope would be the audacity of Hope squandered. Please right this ship before it is too late.

My warmest regards and best wishes.