Thursday, July 30, 2009

July 30,2009/1

The dog days are soon upon us, and it's hard to be upbeat. Everything seems so wrongheaded, as if common sense had been made illegal. I'm no expert, but the Health Care issue looks like a Gordian knot to me. It also looks like the Wall Street bailout has benefited mainly the Street, not so much the rest of the country. Perhaps it's our deficient sense of history, but we seem to have an equally deficient sense of the future. We don't ask, "This is happening. Where is it likely to take us?" Instead, we get run over, clamber to our feet, and ask, "This has happened. Why?" Investigative commissions are set up and they will find that the pricing algorithms that Wall Street used in the runup to the Credit crisis were flawed. Rereading Pecora's review of the '29 Crash shows that almost exactly the same behavior patterns were manifested in the Jazz Age as in 2005-7. There seemed to be no one around, myself included, and certainly no one in a position to do anything, who said that if the Street does this, and this, and this, calamity is a sure bet.
Of course the big problem is Washington. For fifteen years now, operating on the theory that you get the government you pay for, I've argued that we cannot expect much from legislative bodies whose members are paid less than third-line Wall Street people to preside over a $13 trillion economy. So we end up with people who can't afford to be in Congress (who else in America is required to maintain two residences, one in the district and one in the District) and are supported by K-Street off the books, and a Senate peopled with idiot millionaires. Then throw in the ratcheting-up of campaign costs...well, it figures. Time and again, in the Observer and elsewhere, I've fulminated on this point, and folks have looked at me like I'm nuts. At last, however, someone else has mounted the barricades, Matt Gimein, a writer for The Big Money. You can read him here.
And I'd like to see us go whole hog. Pay our legislators sufficient compensation tp keep them out of the hands of the K-Street pimps, and break up Washington as well. Leave the Congress, White House and Supreme Court in the District, and the Pentagon across the river. But relocate the departments to other parts of the country: State Department to Brooklyn (Atlantic Yards), Fed to Manhattan, Energy to Houston etc. etc. Tremendous local stimulus. After all, some wenty years ago, on some talk show, I observed that it was a terrible omen for the country that the hottest real estate market going was Washington, DC and its conurbation (a great word I'm pinchingfrm Jason Epstein's excellent piece on Jane Jacobs in the latest NY Review of Books.) I think I've been proven right.

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