Broback's Blog

Broback's Blog header image 2

Literally the Scariest Thing I Have Heard From a Gov’t Official in Years

May 10th, 2009 · 2 Comments · Uncategorized

If this unattributed quote is accurate (and from someone reflecting the sentiment from the top), it should leave those who care about our long-term economic viability quaking in their boots. It’s from a Wall Street Journal piece that profiles how bond-holding investors are now lumped into the class of reckless “speculators” and have been thrown to the wolves in favor of the UAW. Here is what sent chills down my spine:

You don’t need banks and bondholders to make cars,” said one administration official.

I think Karl Marx said it best:

Capital is dead labor, which, vampire-like, lives only by sucking living labor, and lives the more, the more labor it sucks.

Well put, comrade!


2 responses so far ↓

  • 1 Jason Preston // May 11, 2009 at 11:17 am

    I think you’re reading out-of-context meaning in that quote.

    The way I read it is: this explains why the bondholders got such a raw deal – “since we’re providing our own money, they have nothing we need to make cars.”

    As a pure statement of fact – that’s true. If the government wants to pay for it, all they need is the machinery to make it happen.

  • 2 Steve Roth // May 11, 2009 at 1:49 pm

    Are we realistically even a little bit scared that there won’t be enough banking in our economy in future years and decades?

    In 1929, for instance, bank loans went off a cliff. They stayed flat for thirteen years (and shrank as a share of the economy) while the economy skyrocketed.×314.png

    You need banking and lending, but only a certain amount.

    On the opposite side, we’ve seen awfully convincing recent evidence that when the financial sector gets too large as a portion of the economy–without commensurate growth in actual productive business and investment–it can be a really, really big problem.

    Realistically, imagining actual possible futures, which of these should have us “shaking in our boots”?

Leave a Comment