Is It Wise to Ask a Fox to Babysit the Henhouse?

The GOP deregulated our capital markets, shouting from the roof-tops that market forces and voluntary regulation would be good for us.  We've all learned the hard way in the last several weeks that didn't work out so well.

Investment banks and commercial banks started to collapse.  Home foreclosures went through the roof.  Whispers of dried up credit started to resonate.  Finally, when our government realized it couldn't stand by anymore, it tried to come up with a plan to fix things, though that wasn't much of an exercise in cooperation and bi-partisanship.

We thought we could breathe at last and, for the weekend, some of us did.  This morning, things aren't looking too pretty or shiny on Wall Street, with the Dow Jones average below 10,000 for the first time in four years.

And as if that's not enough, guess who Treasury Secretary Henry Paulson (formerly of Goldman Sachs) has nominated to head up the plan to "save" our economy?

Paulson says 35-year-old Neel Kashkari should be the man -- another high-level Treasury Department adviser who is also another former Goldman Sachs investment banker, as well as a contributor to George Bush's 2004 presidential campaign.  Plus there's the whole question in my mind of whether anyone at age 35 has the experience to manage this global mess.

So explain this to me -- if it's the government and investment bankers who got us into this whole economic crisis in the first place, why are they the ones overseeing this $700 billion creation?  Wouldn't some really smart and more neutral economists be better to take the reigns?

Call me crazy, but I'm just having a hard time getting my head around the fact that the ones who were asleep at the switch now have babysitting duty.

Joanne, who also blogs about politics at her place PunditMom, is also busy today trying to figure out whether to hold 'em or fold 'em.

Comments

[Donna]

Unfortunately, just about every government "henhouse" has been led by a "fox" these last eight years. So this isn't surprising.

Having heard how very complicated the toxic security instruments were (some designed by physicists & mathematicians - and on MarketPlace today, they said that Kashkari actually is a rocket scientist, having worked in that capacity at NASA before going into finance) -- it's possible the only people with the knowledge to unravel the problem are the ones who got us in to this in the first place. We probably do need these guys to be part of the solution. And this doesn't put my mind at ease any more than it does yours.

[Sharon]

I have the same questions. I was talking to my daughter this afternoon as we watched the news about the falling Dow...and we both wondered why the smartest economists in the country have not been included in the discussion. Or have they and we don't know it? Wouldn't it make sense to have the best and the brightest working on this problem? Ooops. I see my mistake....That would make sense.