via Romer: Krugman’s Criticism of Toxic Assets Program “Unfair”.
Christina Romer, chairwoman of the White House Council of Economic Advisers, took umbrage with early critiques of the president’s plan to buy up toxic assets from Wall Street banks on Sunday. Responding to New York Times columnist Paul Krugman, who declaring the blueprint an “awful mess,” Romer called the administration’s critics “just unfair.”
It does my heart good to hear someone else besides me call out Krugman on his early prophecies of doom. Krugman’s biggest fault is that he tends to stretch to find justification of a far-left ideological economic package. He issues edicts from a progressive ivory tower.
Appearing on CNN’s State of the Union, Romer pressed forward with promotion of the administration plan that would take a trillion dollars, culled from taxpayers and private investors, to buy up risky and distressed assets. When asked about the poor early reviews, she shot back.
“I think that’s just unfair. Keep in mind why we are doing this. It’s precisely because banks have these [toxic assets] on their books… We are trying to help the taxpayer by using the expertise of the market by trying to set the price for these toxic assets… It is going to be safe, we very much have the taxpayer’s interest in mind, but we also very much have the interest in the economy in mind.”
The administration is trying to adjust the value of these “toxic” assets upward in order to help the banks stock value and credit rating rise. This loosening of credit must happen somehow, and if Krugman can come up with something more sound then fire away, you know. The only thing I’ve heard him say is that Obama’s plan is on the right track, but too small. You can read what I’ve said previously about Krugman here.
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