StanCollender'sCapitalGainsandGames Washington, Wall Street and Everything in Between

GOP Criticism Of The Federal Reserve Was Both Predictable and Predicted

15 Nov 2010
Posted by Stan Collender

The fact that a number of prominent Republican economists and political strategists today severely criticized the Federal Reserve for the quantitative easing it announced two weeks ago was anything but a surprise. 

Here's what I said would happen in a post from this past August

Ben Bernanke may have painted a big bullseye on the Federal Reserve when he spoke last week in Jackson, Wyoming, about the Fed providing additional stimulus if the economy needs it.
It’s not at all clear, however, whether Bernanke realizes that the same political pressure that has brought fiscal policy to a standstill in Washington is very likely to be applied to the Fed if it decides to move forward. With Republican policymakers seeing economic hardship as the path to election glory this November, there is every reason to expect that the GOP will be equally as opposed to any actions taken by the Federal Reserve that would make the economy better, and that Republicans will openly and virulently criticize the Fed for even thinking about it. The criticism is likely to come both before any action is taken to try to stop it from happening and afterwards to make the Fed think twice about doing more.

 Wait, there's more: Looks like Paul Krugman is thinking along the same lines and Brad DeLong is disgusted.

an ailing economy and tattered foreign policy helps R's

They don't want to tackle these problems, they want to ride them back to power so they can continue redistributing income upward.

The GOP always needs to find an enemy to attack

They wouldn't want the economy to recover too quickly, for obvious reasons.

The modern conservative

The modern conservative movement (and it's wholly owned subsidiary, the Republican Party) are beginning to remind me of the aliens in "Alien" -- a parasitic, machine-like species perfectly evolved for a single function: killing.

Except in the case of the Republicans that single function is: winning elections.

They don't always succeed, of course, but their will to power is continuous, relentless, and apparently inexhaustible. Every action, every statement, every waking thought appears to be subordinated to it.

I may hate the conservate machine and what it's done to this country, but, like the robot doctor in Aliens, I have to "admire its perfection."

Bishop Was Perfect Too

Bishop from Aliens was the Democratic Ash. And he too was perfect. So all is not lost!

Ash from Alien was the Republican Bishop—played by Ian Holm, who also played the doctor who cured King George III of his insanity. (Somehow, it seems significant.) I disagree with you about some details, however. The aliens (speaking of all the movies) weren't killing just to be killing; mostly, they captured the humans and used them to reproduce. In this way, the aliens were just like the Republican Party. This goes along with my comment earlier about the idea from Nineteen Eighty-Four of "power for power's sake." The Republicans will do anything to keep the party alive. And that seems to be all there is. It is not as if the Republicans really have any notions of what they will do with power other than cut taxes, which is just a left-over from an earlier time when Republicans did have ideas. Note the fact that much of what Obama has accomplished is what McCain said he would do if elected—and then voted against when he got the chance. The point is not policy but continued existence. We eat today so that we can eat tomorrow.

Part of me really associates the Republican Party with the Borg. It is like they are a single organism because they are so much in lockstep. This is not just true on the federal level. We see this very clearly in the California legislature.

All of these comparisons (Nineteen Eighty-Four, Alien, and Star Trek) have one thing in common: the elevation of the Party above that of everything else. They will destroy the country to save the Party.

I'm sad to say I really believe this is true.

Alien Perfection

Yes! Yes! Yes! Ash was talking about the perfection of the Aliens—I know! And Bishop shows he is not perfect when he stabs his hands near the beginning of Aliens. But the rest of the comment stands!

Does anyone else think that it is totally cool and eerily appropriate that Dick Cheney's heart pump means he no longer has a pulse? Does a vampire have a pulse?

Pete & Zic

If you combine your analyses, you have the actual answer: the conservative movement exists to distribute income upwards. The only governing successes the Bush administration had involved cutting taxes and funneling massive government spending to the private sector. Everything else they touched was ruinous.

This will continue until we have a real depression. The backlash will be ugly and long. But it's 10-12 years away, ad least.

You Say "Cynical"; I say "Perceptive"

Paul Krugman commented that you were even more cynical than he has been. I find this an odd statement. It has been well over a year since I thought most observers believed that the federal Republican Party would do anything to keep the economy in as bad a state as possible because it was to their political advantage.

This reminds me of Orwell's Nineteen Eighty-Four, when O'Brien tells Winston, "The Party seeks power entirely for its own sake. We are not interested in the good of others; we are interested solely in power. Not wealth or luxury or long life or happiness: only power, pure power." What does two more years of the suffering of millions mean if the Republican Party can gain control of both houses of Congress and the White House in 2012?

I don't think such thoughts are cynical; they are just a clear reading of the current state of politics in the US.

Back the Fed

Great commentary by Collnader. He must have had hair on his head 35 years ago at Berkeley, inside that frat house that was called the public policy school.

Opposition to QE2

I've heard John Taylor speak several times recently, and read his book about the recession. It's not obvious to me that he opposes QE2 because he thinks it will work. Or that that's why several other economists listed in the ad oppose QE2. Is there evidence for the claim, or is this what Krugman means by cynicism?

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