This is exactly the point I was trying to make: The great private sector experience rating for GWB didn’t map to better economic returns (instead of undoing damaging entitlement legislation (put in place by the Democrats) Republicans actively pushed for making things worse). Hence, prior private sector experience doesn’t appear to help but rather is at best neutral where economically sensible policies are concerned.

I am not trying to assign blame to one party for the current economic crisis – I just get upset when one of the side attempts to do so. Practically, we have the interesting situation of the folks in DC looking for ways to milk taxpayers some more to benefit first and foremost themselves and then their chosen ingroup.

I also stand by my early explanation attempt – as a species, we tend to confuse ‘is at the top of the status pyramid’ and ‘got lucky a few times’ with ‘makes a positively impactful contribution’. I have the nagging suspicion that in many cases, CEOs make their companies successful just like the Aztec Emperors made the sun rise each morning: by being there.

Your analysis would hold water, but unforunately it is one sided: it only examines sellers. The repeal of the portion of Glass Steagle cited in so many analysis does allow for the creation of questionable debt. However it says nothing as to why anyone would willingly buy that debt. For that you have to look at the remainder of Glass Steagle particularly FDIC, and the presumed bail outs of Fanny and Fred which were virtually guaranteed, which to a great extent socialize losses and mean the safety of banks’ balance sheets are disregarded.

So while your analysis is ‘correct’, it is also misleading. The repeal of the small portion of GS allowed the creation of bad debt to occur, it is the CRA, the lack of oversight of Fanny and Fred, the flooding of the economy with cheap credit by The Fed, and the remaining FDIC legislation and virtual guarantee of government bail outs that TOGETHER caused the economic crisis.

Which means on the whole it was the government and government backed bankers that have lead us to where we are today.

You are correct in that the Commoditity Futures Modernization Act cannot be laid at Bushes feet except for an accident of timing. I was trying to make a point concerning the perceived but not actual fiscal conservatism of the party that ought to know better, the Republicans.

That notwithstanding, it was what caused the housing crisis 8 years later by enabling the unregulated credit default swaps that enabled mortgage operators to obfuscate the risk in these instruments and hand out mortgages like candy (see http://en.wikipedia.org/wiki/Commodity_Futures_Modernization_Act_of_2000 for the history of the act and http://en.wikipedia.org/wiki/Subprime_mortgage_crisis for the impact of these instruments in the crisis; I hope you find wikipedia a more acceptable source of information. Personally, I don’t care about the source of my info but about its content).

Note that the bill was indeed sponsored by Phill Gramm and intended to deregulate the markets in question and remove them from SEC oversight. Note also that the bill is involved in two financial disasters – Enron and the housing crisis.

I concur with the city journal article you linked to – bailing out failed institutions is IMHO always incorrect (the money spent on maintaining an obsolete and obviously economically unsuccessful process will always be large than just handing out charity to the tune of previous wages to the people affects; in that sense, the “bailouts save jobs” argument is incorrect by definition. I’d also like someone to explain to me what exactly “saving a job” means and why it is a good thing).

I also would have suggested Sowell’s book, but as a case in favor of my argument. Reread the section on deregulation and I am sure you’ll see why.

Please understand – I don’t care much for either Democrats or Republicans in general, and I specifically take issue with presidents Bush and Obama for their actions. I am a fiscal conservative – I hate it when people decided how they should spend my money (and my childrens money) for them. My complaint is more that there is not a single party that I can vote for that has an apparent interest in preserving my property and allowing me to pursue happiness unhindered.

Instead, I have one party that believes in spending my money on bailing out failed financial institutions, a pointless war and religious causes and another that believes in continuing a pointless war, bailing out financial institutions and feel-good causes like the healthcare debacle we’re about to start onto. Both promise that no taxes will be raised in the process of doing so and will happily blame each other once it becomes apparent that you cannot spend tens of trillions on the bailouts and another few trillion on wars that have nothing whatsoever to do with the safety of the US without radically devaluing the dollar and, oh, who saw this coming, raising taxes.

Meanwhile, the constitution is reduced to words on a piece of paper to avert whatever ‘the current crisis’ is, federal, state and municipal restrictions prevent me from using my property (or artifically inflate property prices).

As for the McCain-smearing: could you please point out where you see that? For the record, I had high hopes for McCain up until he chose Palin as his running mate (and was frankly disappointed Bush was running against Kerry instead of McCain in 2004)

One quibble: The Iraq War made Bush a weak President domestically. He had to buy the 2004 election with things like the Prescription Drug Benefit — those elderly voters in Ohio don’t come cheap. Bush didn’t fight to rein in Fannie and Frannie, also because of this. McCain did.

One amplification: McCain went to just one meeting with regulators at Keating’s behest. At the time this was a natural thing for McCain to do, as Keating was a well-thought of big wig based in Arizona. From what McCain learned at that one meeting, he dropped Keating like a hot potato. McCain never influenced any regulatory outcome. McCain was included in the proceedings solely because he was a Republican.

You have revealed yourself as a troll. Nobody who calls themselves a conservative anything would try to offer a propaganda piece from ridiculous Huffington Post as evidence of, well, anything. But by the end of your comment you’ve made pretty clear you’ve drank deeply of the Kool-Ade there.

The piece is a baseless smear from start to finish, with the ultimate goal of trying to blame John McCain of acts he was never found to have committed. Where it doesn’t grossly distort the fact it completely omits others in an attempt to smear McCain in last year’s election season. Right off the bat, the writer goes into propaganda mode by attempting to tie Bush, who wouldn’t take the oath of office for another two months and had zero involvement in the legislation, having neither been in the House or the Senate. This was not something slipped into the budget under cover of darkness by Phil Gramm (one of the few actual economists to ever sit in national office in this country, as opposed to the legion of lawyers), it had in fact been under discussion for years. And when the time came, President Clinton signed it into law.

Nor was this the basis of the current economic woes, nor other Gramm-lead legislation. This has been widely agreed upon even by those who were opponents at the time. If they’re honest, that is. The cause of the current problems are government interventions attempting to change the very nature of the universe and discovering the hard way that elective office does not grant one the power to alter basic math or human nature. There is no such thing as a safe investment. Everything you do to curtail risk also reduces the potential gains. The role of government is not to try to make every venture safe but to limit as best as possible the fallout of failure to those directly involved and cognizant of the potential for both gain and loss. Anyone who invests in something where these issues are not understood has only themselves to blame.

Limiting risk means the government doesn’t step in to rescue your ass when you screw up. This article details how this terrible policy got started in the Reagan Era, when the Administration was forced by a Democrat controlled Congress to enact the bailouts in exchange for continuing the non-trivia undertaking of winning the Cold War. http://www.city-journal.org/2009/19_3_financial-institutions.html

If you want to be better understand the underlying problems that got us here, read ‘The Housing Boom and Bust’ by Thomas Sowell, a genuine fiscal conservative. This isn’t something that started with the Bush Administration. The real roots of the story go back to a hoax perpetuated by the Boston Globe in the 70s, which claimed lenders were mean to black people sole because they were black and not because they had lousy credit histories, that was used as the rationale for legislation called the CRA. This in turn was greatly strengthened under Clinton into a guarantee of eventual disaster. The Bush Administration tried to rein in Fannie Mae and Freddie Mac, the entities that greatly enhanced the CRA’s eventual destructive effects. The GOP control of the House and Senate was never sufficient to make any real progress on this because the assorted entitlements and other programs were so deeply entrenched and defended by politicians with substantial seniority. The likes of Barney Frank and Christopher Dodd have far more blame to bear than the previous President.

Back to the McCain smear. The author drags up the Charles Keating scandal but neglects to mention that the other members of the senatorial Keating Five were all Democrats, and that of the five, McCain and John Glenn were found not to have done anything wrong. The remaining three Democrats were found to have interfered with the regulator in the course of its duties and all three chose not to run for re-election as their terms ran out. Gosh, why do you suppose the author chose to focus on just McCain and not even name the other guys?

The bailouts have always been a bad idea, along with the failure of politician to resist the lunacy of John Maynard Keynes. Unfortunately, both cases appeal to the politician’s delusional belief that he can fix anything, given the power and a printing press running 24/7. In reality, a politician can only mitigate suffering, not fix problems. Failures need to happen to punish bad ideas. The earlier the better. As in better to lose a million dollars of investors money instead of growing a bad idea on hype so it can lose a far greater amount. One example of this is allowing a single bank to loosen its credit standards to win or fail on the choice, rather than strong-arming all the banks into taking the same risk. But the strong-arming approach is exactly what the Left chose.

I tend to be with you on the financial conservative thing.

BTW look into Thaddeus Mccotter from Michigan – I think he’s the closest thing to a libertarian that congress has to offer

The chart I quoted (http://zfacts.com/metaPage/lib/National-Debt-GDP-L.gif) makes the point that the frequent confusion of the fiscal right with the political right is incorrect – recent politically right administrations increased spending drastically more than recent politically left administrations.

Show me a politician with a record of voting for small-sized, less invasive governance and substantially reduced budgets and I’d be thrilled.

Good writing, however, you should fact-check. The deregulation that directly led to the mortgage crisis was a policy instituted at the beginning of the Bush years (http://www.huffingtonpost.com/jim-moore/a-nation-of-village-idiot_b_127340.html). The disasterous “let the tax payer bail out the private sector to support future banker bonus payments” decision was the finishing touch of the Bush period.

I should also mention that Bush had 8 years of control without doing anything despite being explicitly warned about the impending crisis (http://www.msnbc.msn.com/id/27121535) and got us into the costly Iraquistan mess on top of everything else as part of his War on the US Constitution.

Note that I am not defending the Obama administration here – IMHO, they are at least as much a disgrace. Bush was a moronic fratboy trying to do good for his cronies regardless of law or common sense, so expectations should realistically have been set low. To see his declared opponent (the guy who just based on the law of large numbers ought to behave smarter) continue the Bush policies is very disappointing.

Here is Hilda Solis’ biography: http://en.wikipedia.org/wiki/Hilda_Solis

What in there suggests the remotest personal experience of running a business. At best, all she has is her husband’s input. Other than that, she was born and raised a union tool, a role she has devoted her life to fulfilling.

Also, your link is broken and I couldn’t find what you might have been trying to show. I did see a lot of utter nonsense on that site that me dubious of what these guys regard as private sector experience. Also, Arnold Kling has no understanding of the video game business.