Federal Reserve Board
Free Peter Diamond!
March 09, 2011
Few political spectacles depress and alarm me right now more than the stalled nomination of Peter Diamond. For those of you who don't already know, Diamond is the MIT economist whom President Obama has nominated to serve on the Federal Reserve Board. Diamond is widely considered among his generation's most brilliant economists.
September 13, 2010
This is a season of liberal disappointment. Or, rather, another season of liberal disappointment. Liberal disappointment follows liberal triumph as night follows day. It is a multitudinous thing, its varieties including, but not limited to, despair, recrimination, impotent rage, potent rage, and existential angst. The genus currently in full bloom is precrimination, a subspecies of recrimination that occurs before the fact. In this case, the liberal argument is that President Obama has blown the 2010 elections by moving too far to the center. My colleague John B.
The CBO Director Just Made Fiscal Policy Seem More Confusing. Yes, More Confusing.
September 01, 2010
Ben Bernanke's “unusually uncertain” may be for our times what Alan Greenspan’s “irrational exuberance” was to the late 1990s—a phrase that captures the dominant mood without providing much policy guidance. As dissent continued to rise in the ranks of the usually united Federal Reserve Board, unusual uncertainty reigned supreme at the annual Jackson Hole meeting.
Why You Should Care About Peter Diamond
August 06, 2010
If you're a liberal who follows politics closely but not that closely, then you probably know a lot about Elizabeth Warren but not much, if anything, about Peter Diamond. That's too bad. Like Warren, Diamond could end up with a pretty important position--one from which he could do a lot of good. But, like Warren, Diamond has provoked the ire of some conservatives who want to keep him from that post. Diamond is one of President Obama's three nominees to the Federal Reserve Board of Governors.
Why Brandeis Matters
June 29, 2010
Louis D. Brandeis: A Life By Melvin I. Urofsky (Pantheon, 955 pp., $40) I. In 1916, Herbert Croly, the founder and editor of The New Republic, wrote to Willard Straight, the owner of the magazine, about the Supreme Court nomination of Louis Brandeis. Croly enclosed a draft editorial called “The Motive of Class Consciousness,” and also a chart prepared by a lawyer in Brandeis’s office showing the overlapping financial interests, social and business connections, and directorships of fifty-two prominent Bostonians who had signed a petition opposing Brandeis’s nomination.
My Dream State of the Union Address
January 13, 2010
In his forthcoming State of the Union address, President Obama has an opportunity to reset his administration and regain the initiative. What follows is the domestic policy portion of a speech he could give if he decides to do that. The alternative is some version of steady-as-you-go. This would reflect a judgment on his part that he’s doing just fine, or at least well enough—the B+ he awarded himself a few weeks ago. Unfortunately for him and for his party, this is a judgment with which an increasing share of the electorate disagrees.
Let Me Explain The Cadillac Tax
January 12, 2010
Allan Sloan, in a column criticizing the proposed tax on expensive health insurance plans, says that most of the revenue from this tax wouldn't come from the high-cost plans: [I]f you look at the actual workings of the plan, you come away far less impressed.
Did the Bank Bailout Increase Lending?
October 08, 2009
U of Chicago's Casey Mulligan, pointing to an audit issued this week by the TARP inspector general, says no: Economic theory casts significant doubt on the claim that public purchases of bank equity would cause banks to lend more. Now the government’s own watchdog confirms the theory. Unforunately, the inspector general stays mum on how it arrived at its conclusion: Federal Reserve Board officials provided institution-specific data and an analysis of the state of the U.S. economy that was deemed sensitive, confidential, and, restricted.
Why the Status Quo in Consumer Financial Regulation Stinks
September 22, 2009
In my cranky item yesterday arguing against a proposal for consumer financial regulation being floated by a group of Blue Dog Democrats, I mentioned the problem with combining consumer regulation and safety and soundness regulation of banks (that is, the status quo the Blue Dogs basically want to preserve), and with putting a big council of regulators rather than a single agency in charge of the former (that is, the way the Blue Dogs want to make the status quo much worse). It turns out that, over the weekend, a group of prominent consumer law professors sent a letter to the leadership of the
Did Bank Lobbyists Write Obama's Reform Proposal?
June 18, 2009
What is the essence of the problem with our financial system--what brought us into deep crisis, what scared us most in September/October of last year, and what was the toughest problem in the early days of the Obama administration? The issue was definitely not that banks and non-banks could fail in general. We're good at handling some kinds of financial failure. The problem was: a relatively small number of troubled banks were so large that their failure could imperil both our financial system and the world economy. And--at least in the view of Treasury--these banks were so large that they cou