Gene Sperling, Then and Now

By James Kwak

Mike Konczal points out Gene Sperling’s recent performance on MSNBC, arguing that uncertainty about long-term deficits is weighing on the economy.

What surprised me is that I was just (re-)reading about the early days of the Clinton economic team, and back then Sperling was on the other side of the debate. In Robert Rubin’s account of the famous January 7, 1993 meeting (well, famous if you’re into economic policy debates from two decades ago), the deficit hawks were Al Gore, Lloyd Bentsen, Leon Panetta, and Rubin. The people who wanted more stimulus and less deficit reduction were Robert Reich, Laura Tyson, George Stephanopoulos, and Sperling. (See In an Uncertain World, pp. 123-24.) In Clinton’s memoir, Sperling was also on the side of stimulus and investment: “Gene Sperling made a presentation of options for new investments, arguing for the  most expensive one, about $90 billion, which would meet all my campaign commitments immediately.” (My Life, p. 461.)

Of course, the economic conditions were different back then. Interest rates actually were high (ten-year Treasuries were at 7 percent, with inflation under 3 percent), and Tyson, Alan Blinder, and Larry Summers were all arguing that deficit reduction would lower interest rates and stimulate growth. Alan Greenspan was also implying that if the new administration reduced the deficit, he would help lower interest rates. In other words, back then there probably was something to the idea that deficit-cutting could stimulate the economy.

That’s clearly not true today, because interest rates are already about as low as they can be. Or at least, if you’re going to argue that deficit-cutting will stimulate the economy, you have to come up with some other transmission mechanism, because it can’t be interest rates. There are valid reasons to want to fix our long-term debt problem, but stimulating the economy in the short term isn’t one of them.

So why is Sperling now the man arguing for deficit reduction? The simplest explanation is that he’s on TV defending his boss, and his boss wants deficit reduction. The other explanation, which Konczal suggests, is that Sperling and the rest of the economic team are products of the Clinton administration, and deficit reduction is what worked for them.

Summers, who was a deficit hawk in 1993, is now in favor of near-term traditional fiscal stimulus — an extension of the payroll tax cut and more infrastructure spending — and deficit reduction in the medium term. He can see the difference between 1993 and today. Of course, having left the administration, he also has the liberty of speaking his mind.

39 thoughts on “Gene Sperling, Then and Now”

  1. This is just obscene.

    I am a management consultant at one of the world’s largest professional services firms, and I can tell you that my clients (executives at Global 2000 sized companies) are not concerned with “uncertainty about long-term deficits”. The uncertainty they are concerned with generally involves how much their customers will spend on their products and services. Incidentally, that’s the same uncertainty with which my firm is concerned. I would imagine it’s also the top concern for small businesses across the country.

  2. I agree. You may have seen this earlier post: https://baselinescenario.com/2011/06/06/not-all-businessmen-are-smart-you-know/.

    It’s interesting — generally we accuse corporations of being focused on the short term. And it’s true, they are focused on the short term — as in, how many products am I going to ship next quarter? Yet somehow, magically, we think that they are also making business decisions based on massive entitlement program deficits that are more than a decade away?

  3. Imagine how much the economy would be stimulated if all government-funded healthcare were discontinued (as a result of eliminating entitlements). Seniors and others dependent of government assistance would suddenly flood into the private healthcare provider arena, emptying out their savings, liquidating their assets. It would be a huge stimulus for the private sector.

    On the downside, newly homeless people would dissolve into festering corpses in the gutters.

    On the upside, the sanitation sector would see a brisk increase in business.

  4. Jeff, good one! :) What do homeless corpses in the gutters have to do with the deficit? Explain why homeless people would die if the fed government actually balanced its budget? LOL! :)

  5. So basically, Sperling, who, mind you is no great economic mind – he has a Yale JD and never finished his Wharton MBA – got lucky in the 90s and is now trying to apply the “lessons” he learned in the 90s re: deficit reduction to the liquidity-trap scenario we face today. Amateur hour.

  7. Don Vito – Why would business owners look at the 9.2% unemployment rate and “abysmal job numbers” and conclude that the problem is too much government spending? That’s an incoherent position.

  8. “He can see the difference between 1993 and today. Of course, having left the administration, he also has the liberty of speaking his mind”

    Or James, he says these things to undermine any movement in one certain direction other than what the wealthy elite want. Confusion goes a long way. Remember what Romer said. She wanted more stimulus and ppl like Summers refused. Summers is someone who could go into the Oval office and tell Obama give me $1 trillion in spending and it would be done. Most likely, he is trying to align himself for another stint in some ceremonial job.

  9. @Don Vito: to connect the dots for you, (0) efforts to balance the budget cut out government-funded health care, (1) people that rely on the government to supply their healthcare no longer receive it, (2) they get sick, (3) their only recourse to receive life-saving treatments is to pay cash, (4) they run out of cash, (5) they sell everything they have to come up with the cash to buy the life saving treatments that will keep them alive or they divert rent into payment for said treatments, (6) they run out of cash, (7) they become homeless and broke, (8) they die on the streets, (9) they rot. Did I leave anything out?

  11. Jeff, you crack me up :) Thanks for making me chuckle on this Friday afternoon.

    Rule number 1: Never rely on the government to supply you anything, especially healthcare.

    Rule number 2: If you do, you live at your own peril.

    Keep looking for the list of entitlements in our constitution… please advised or are you just making it up as you go?

    What’s the next entitelment?

  12. @Don Vito: I note that both ‘common defence’ and ‘general Welfare’ are listed in the Constitution’s preamble: “We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America.”

    Does that mean national defense should similarly be include in a list of things to excise from the budget?

    Even Michele Bachmann isn’t that crazy.

  13. Don Vito – Thanks for the link. A hearty laugh is a good thing every now and then. The authors suggest that businesses fear deficits because deficits necessarily result in higher taxes down the road. That little bit of nonsense is known as Ricardian Equivalence, and while it might be true in a barter economy operating at full employment it certainly is not true in an economy with fiat money and a developed financial system, let alone one with unemployed resources. That was a HORRIBLY written article overall. The quality of “research” at Heritage looks to have taken a dramatic fall these last few years.

  14. @Don Vito – it’s called the General Welfare clause – it’s in the preamble and in Section 8, Article 1. Last time I checked ~2/3rds of bankruptcies where caused by medical expenditures. How is that in our general welfare?

    Anyone that takes a literal interpretation of the constitution really needs to re-do civics. Originalism is devoid of historical and logical fact.

    ps – not like the Heritage foundation doesn’t have a political slant. They’ve been at or near ground zero for just about every GOP policy that takes power from individuals and gives it to monied or corporate interests.

    pps – Every other major industrialized country in the world has some form of public health care at 1/2 the cost and 2x the benefits. It is a particular sickness of the US that we seam to think we can go against all the facts.

  15. You guys should start a comedy routine!

    How do you turn an article about additional government spending vs. deficit reduction into a debate on healthcare?

    All I was trying to say is the only way to reduce deficit and get the economy going again is to reduce spending on all entitlements ( social security, medicare, Obamacare, etc. ) and government programs. As 2 1/2 years of the Obama administration has shown us, you can’t spend your way out of a recession.

    Please stay on subject!

  16. “The people who wanted more stimulus and less deficit reduction were Robert Reich, Laura Tyson, George Stephanopoulos, and Sperling.”

    Stephanopoulos? Mentioned because…? OK, I realize what when one is writing the history of organizations, the fact that someone has a position in the organization far outweighs their objective claim to knowledge, but really…Stephanopoulus?

    And in the same spirit…Don Vito? I realize that “nyah, nyah” is a perfectly legitimate form of discussion, but “nyah, nyah” is the essence of Don’s comments.

  17. @Don Vito – I guess we’re not being clear. We reject the assumption in your statement, “the only way to reduce deficit and get the economy going again” that the deficit is responsible for the current economic conditions. Reducing the deficit will not get the economy going, it will further depress the economy.

  18. You can stimulate and cut and eliminate entitlements, but the Beast (aka: the MIC-Bankster-Security Apparatus) will still be sucking down every last bit of vital fluid from the citizens of this former democratic republic. How did this *government* get so gosh-darn stupid? What are they, alien reptiles? :)

    ANYWHO: When virtually an entire manufacturing base is lost that paid good wages (except for the armaments still being made here), and with people in China making a few bowls of rice per day, and wishing suicide when they’re assembling my MacBook Air, there is no good news, now, or going forward.

    face it, with Medicare and Medicaid cuts in the works, you’re elderly parents are going to take the hit, and then you, and me, and your children, and my own.

    When Social Security is pared down, or ruined, get used to eating Alpo out of the can, and with no razor blades to shave, acclimatize your look to scraggly facial hair….

    We provide for the welfare of Raytheon, Boeing, Electric Boat, and all the others so dependent on us killing poor people of color around the world, so I can’t understand why not provide for the people who make up the country? How much longer can this juggernaut of long war go on, without someone screwing up to the point big missiles come out from hiding?

    Cutting federal spending means fewer jobs in an already pathetic job market environment, and as Rue correctly points out, “it will further depress the economy”. No question about this.

    Jane Hamscher (of FIREDOGLAKE) rips the “democratic party” (even the putative “progressives”) a new one today, and I am in complete agreement with her analysis:

    http://www.commondreams.org/view/2011/07/08-3

  19. @ Don Vito

    “How do you turn an article about additional government spending vs. deficit reduction into a debate on healthcare?

    All I was trying to say is the only way to reduce deficit and get the economy going again is to reduce spending on all entitlements ( social security, medicare, Obamacare, etc. ) and government programs. As 2 1/2 years of the Obama administration has shown us, you can’t spend your way out of a recession.

    Please stay on subject!”

    It is very much on subject. Healthcare (Medicare, Medicaid, VA, CHAMPUS, etc.) and “defense” are the largest categories of Federal government expenditure and between them account for the majority of it. You cannot seriously hope to reduce government spending without hacking deeply into both of those. To do the former in a way that doesn’t leave old and poor people’s corpses rotting in the streets, you need to reform the health care system as a whole. It is seriously bloated, at least 1/3 of what it does is useless or harmful–not only does this waste massive amounts of public and private funds, it leaves people maimed or even dead.

    As for the lessons of 2 1/2 years of the Obama administration, go back and read the 2008 Paul Krugman blogs or those of other Keynesians. They made _ex ante_ calculations of how much the stimulus would need to be in order to restore something like full employment: the numbers were way larger than the actual stimulus. They also made _ex ante_ calculations of what the impact of the actually enacted stimulus would be–and lo and behold–the stimulus’ effect on the economy turned out to be almost exactly what they predicted. So I would conclude that the lesson is that when you do a stimulus that is woefully inadequate to the task, you see pathetic results. That’s what the Keynesians said would happen, and that’s exactly what happened. Try doing a fact-based, reality-based analysis and you will see that everything you are advocating will only make things even worse than they already are.

    If I were in a kindly mood, I would wish for you to never have to live in the world you advocate. But I’m in a rather vile mood right now, so I’m more inclined to spitefully hope that you will indeed suffer through the dystopian world you seek to impose on all of us. But that would be cutting off my nose to spite my face, wouldn’t it?

  20. Paul Krugman kept saying it and saying it and saying it….ad nauseum,,,,,the stimulus was too puny to confront the daunting devastation wrought by the City of London and its’ junior partners on Wall Street.

    Now, there is no way out, and the austerity ghouls like Don Corleone here, and in Congress, want to completely screw up programs that are among the most effective, humane, and decent things a civilized government has brought to its’ people.

    It’s quite simple: no AUSTERITY…..tax WALL STREET speculative transX with a TOBIN tax, a sales tax, etc. Remove the wage base limitation on FICA tax, the OASDI portion, and increase Medicare tax on high wage earners. The rich have had a field day especially since Bush and the republicans, and now they’re sitting pretty, and old people are worried about Medicare….it’s simply WRONG, and immoral.

    It’s way beyond reich-wing hate-talk radio talking points; you’re really pointing to massively impoverishing millions of Americans, while fat cats inhale coke, and party with Cristal, on $ 300 USD million yachts.

    We are in an inhumane class warfare struggle at this time: we need an FDR, but all we got is an Obama, and a bunch of limp biscuits in Congress, beholden to elite oligarchs. Woe is the rest of us.

  21. Rosa Parks thought the guy was nuts and she did not move.

    You all still want to be the guy who was telling her to go to the back of the bus…

    The oligarchs KNOW it’s over that’s why they’re calling in the mercenaries and the goons with unlimited access to everyone’s financial records and library records and they are going “all in”….yes, they will rejoice at bodies rotting in the streets – what part don’t you all understand about WHO THEY ARE…

    More misery for others = more $$$$ for ME ME ME

    WE KNOW that they don’t have the winning hand and they know that we know.

    Make ’em SHOW their cards…

    How come no one is talking about how in other countries, they take back the ‘hood from the drug dealors….?

    3 days – no more afghan opium in his back yard – war over…

  22. This *sweet* person named Ayn Rand would have rejected an altruistic act, such as a white man offering Rosa Parks a seat at the front end of the big bus, and it’s the same “rational” selfishness that is echoed in the rantings of the austerity ghouls, in phrases like: ” As American citizens we are not entitled to anything except for the liberty and freedom to make it on our own.”

    But when Ayn Rand got ill as an old person, she ostensibly had no qualms about being on the receiving end of government assistance, a stark incongruity with what she was saying to Mike Wallace and CBS in 1959, here:

  23. As you can see in the artist’s rendition if you scroll down slightly in this link, many people have been beaten into submission with a riding crop by Ayn Rand.
    http://www.gq.com/entertainment/books/200911/ayn-rand-dick-books-fountainhead

    Too bad Ayn Rand’s ditto-heads lost their ability for analytical thought in the process. Witness the blatherings and intentional misleadings of Peter Wallison. I kept speculating Peter Wallison would finally search out his true calling as Newt Gingrich’s campaign finance director. Apparently, crawling away from nursing off American Enterprise Institute’s tit would have been waaaay too traumatic for Wallison.
    http://rortybomb.wordpress.com/2011/05/18/peter-wallison-discusses-fannie-and-freddie-for-the-american-spectator-or-where-are-the-fact-checkers/

  25. ”So why is Sperling now the man arguing for deficit reduction?”

    I think the real question is this: Is Sperling unambiguously arguing for immediate and significant deficit reduction? Interestingly, this is still (the interpretations of Krugman et al. notwithstanding) a categorical statement I have yet to see explicitly made by the Obama administration.

    In listening to a visibly-pained Sperling give his answers on O’Donnell, I noted that he points out that the deficit reduction shouldn’t be “front-loaded”. Which is to say: best to wait for more recovery, if it’s politically possible. (And this isn’t even inconsistent with prudent Keynesianism, which counsels fiscal conservatism when the economy is good.) All the rest seems to be a mouthing of Republican talking points, possibly for no other reason than to be able to claim, later, that they are addressing the issues raised, and only get even *less* cooperation for their efforts.

    If the GOP makes it politically IMpossible to delay significant deficit reduction measures, the trap is sprung: Obama et al. can then campaign on the evident fact that the GOP, not the White House or Congressional Dems, have taken over management of fiscal policy, and that if you want someone to blame for both higher unemployment in November 2012 *and* a consequent fall in tax receipts making the deficit even worse, you’ve got the perp walk all ready to go: the congresscritters who wouldn’t even brook a delay in significant cuts. And THEY will be almost solidly Republican. They will also include the GOP presidential ticket.

  26. Hiya Bruce, thanks for both links to the videos, I’ve bookmarked them for viewing when I have some time.

    It really is “disaster capitalism”, and if natural occurrences can now be brought forth with special technological applications, as I suspect they now may be, then this amusement park ride will continue indefinitely, or until someone makes a blunder, in which case, we’re toast.

    I’ve witnessed what can be done, and I am impressed with its’ ruthless efficiency, and speed.

  27. @woop

    “sweet”…? uh, okay :-) wha’ever…

    Ms. Rand suffered her whole life from a type of post-traumatic syndrome unique to people who live in the *mind* – whether or not she had other resources to access inside herself to deal with her trauma in Russia – who knows? – she chose not to acknowledge other resources in herself, and in others. Had she not been traumatized, she would have looked to real science to assist in solving the problems of life-maintenance instead of making up a one-legged stool of “0bjectivism”…

    People got together a LONG time ago – they had to. Simple. There were huge herds of large animals – predatory and not – who were accessing the same watering hole that people also had to access.

  29. @ woop: thanks for the note. (Hay Carla, and everyone: Hope you are all well)

    check this one too:

    Zeitgeist: Moving Forward
    Directed by Peter Joseph
    Watch Now!
    “In a decaying society, art, if it is truthful, must also reflect decay. And unless it wants to break faith with its social function, art must show the world as changeable, and help to change it.” -Ernst Fischer
    Zeitgeist: Moving Forward, by director Peter Joseph, is a feature length documentary work which will present a case for a needed transition out of the current socioeconomic monetary paradigm which governs the entire world society.
    This subject matter will transcend the issues of cultural relativism and traditional ideology and move to relate the core, empirical “life ground” attributes of human and social survival, extrapolating those immutable natural laws into a new sustainable social paradigm called a “Resource-Based Economy”. (Excerpt from main website)
    Please visit the official website for more information:
    http://www.zeitgeistmovingforward.com

    http://www.sprword.com/videos/zeitgeistmovingforward/

    Here’s a full index of “critical documentaries” free to view and worth spending some time evaluating. There are some really good ones here:

    http://www.sprword.com/asia.html
    (full inventory index from this link)

    this other site is more broadly based but also has some selective titles that are very informative and instructive from a multidisciplinary spectrum of issues:

    http://topdocumentaryfilms.com/

  30. The point is not whether deficit reduction is stimulative. The point is that debt has interest rates, that must be paid, and that deficits takes money out from the economy(Money that´s used to buy bonds to finance the deficts aren´t money used to make investments).

  31. I love it that people like Don Vito are saying “cut out entitlements”. What do you think an entitlement is, anyway? I paid for it and I want it. End of story. You make me pay for it all my life until you’ve robbed me of all opportunity for productivity (you’re old and irrelevant so get out of the way!) and then, when it’s the only thing left to me, you want to take it away? You are the Satan people speak of when they confuse real life with a god-blessed fantasy world.

    Black is white, up is down, save by spending, win by losing, don’t tax the rich and the economy will thrive, get rid of entitlements and the deficit will disappear – it’s all the same load of exploitative b.s..

  32. Sperling is just one more irrational talking head. There is a constant parade visiting every media outlet and trying to convince those who prefer ignorance over knowledge that the counterintuitive is the cleverest thing. Not that anyone’s intuition is right or reliable, just that counterintuitive preachings always must be examined carefully, especiallly when uttered by anyone in the current political arena. I am sure that, as I see above, all of us can venture considered opinions as to what stands behind the latest Sperling dictum, and some will be right. Problem is, no one really knows. I’ve seen the same kind of thing from guys like Stockman and many others. I’ve also noticed that if the interviewer probes, there is usually a healthy degree of semi-retraction or retrenchment, or supporting vague platitudes. The key thing is that any statement made in support of any political dogma in this environment is likely to be obfiscatory, stupid, or just plain false. I must say though, it’s all a matter of degree, since this has historically been true of politics since we came out of caves.

  33. The Murdoch media mogul scandal is *proof* of prevaricating propaganda.

    People are finally wrapping their heads around the MENTAL INSANITY of the predator class hired to be in service – globally – to self-proclaimed *gods* (who have hair on their backs – go figure)…

    JUST WAR has four strict conditions for “legitimate defense by military force”:

    1. the damage inflicted by the aggressor on the nation or community of nations must be lasting, grave, and certain;
    2. all other means of putting an end to it must have been shown to be impractical or ineffective;
    3. there must be serious prospects of success;
    4. the use of arms must not produce evils and disorders graver than the evil to be eliminated. The power as well as the precision of modern means of destruction weighs very heavily in evaluating this condition.

    We were ROBBED ala *financial innovation* – follow the $$$ after a decade of war, who is rich NOW – did “we the people” approve loading up BILLIONS in paper cash in C5 transports….?

    @pjwrites – Yes, they are trying to take it ALL…they are HAPPY only if they succeed in taking it ALL from YOU – they call it a *jubilee* when another person is left penniless through their schticks of *debt*.

    We have FIAT $$$ – which means it’s total bs what anyone is saying about the numbers and debt.

    Total bs.

    They just want to get in on the action to get everything you paid in from age 15 to 65 – welcome to *kingdom” tribe’s government…YOU do not *deserve* a home, healthcare, or clean food and water.

    Get it – YOU and I do not *deserve* things WE CAN PROVIDE FOR OURSELVES! How sick is that to say such things as Prez of USA!!! Who IS this dude…?

    Number One – “the damage inflicted by the aggressor on the nation or community of nations must be lasting, grave, and certain…” has been met.

    Constitutional Convention to forge an *energy* policy. It’s too freekin’ STOOPID to pretend the *black gold, texas crude* is anything other than FINITE – it WILL RUN OUT. No one wants to wait for that – get it, retards?

    And BURN the Patriot Act.

    How many 13 year old girls were listened to by patriot act goons who hacked into their phones to get off on how they were raped tortured and killed? DO we KNOW? NO!

    They owe US the proof that they are not psychos. We already have the PROOF as to what they did with our finances, don’t we?

  34. “the MENTAL INSANITY of the predator class”…..good one, Annie! It sticks in my craw.

    Here’s a BY-PRODUCT of those (criminally) insane PREDATOR class werewolves and miscreants….the financial ruination of USA…..as evidenced by this: 1 out of 6 Americans now can’t feed themselves without gov. assistance.

    Ayn Rand’s answer? Her “one-legged stool” (touche!), OBJECTIVITY, would have been….let them Starve to death.

    The fascist reich wing in America regards this as the apotheosis of an appropriate and sustaining ideology…go figure.

    Austerity means only one thing for Americans…..millions of deaths, followed by social misery and disintegration. But, there is lots of money to be made, for the Psycho Class in their gleaming skyscraper, directly next to the former location of WTC 1, before it disappeared into dust.

    http://www.naturalnews.com/032939_food_stamps_depression.html

  35. Ayn Rand was suffering from mental disorder brought about by what happened to her in Russia. I seriously don’t get her *popularity*….never did and never will get her schtick….about 100,000 science FACTS about how everything REAL does NOT exist like she saw it!

    We are being FORCED to not provide for ourselves because of what LIARS, THIEVES and MURDERERS want you to *believe* about FIAT $$$$ – who still does not KNOW what FIAT MONEY means on this blog????

    Constitution Convention to forge an *energy* policy. Burn the Patriot Act.

    Austerity my a–….

    Cutting and pasting again – dude who wrote it wrote it in caps – “THE LENDING OF MONEY AT INTEREST UNDER DEUTERONOMY WAS ONLY ALLOWED IF YOU WISHED TO DESTROY AN ENEMY WHICH YOU COULD NOT DEFEAFT BY FORCE OF ARMS. IF WE CONTINUE TO ALLOW BANKS AND OTHER GOVERNMENT BODIES TO RUN THE ECONOMY WITH DEBT FINANCE – WORLD WAR 3 IS AN INEVITABILITY.”

    So is another Civil War in the USA an inevitability – the sadistic goons are too WAY too rich after their decade long “religious” war and MILLIONS upon MILLIONS got nothing to lose and everything to gain by taking them out and taking it back…what HUBRIS to pretend they now OWN – “privatized” – what generations of Americans built!! And WORSE, selling it to foreigners so THEY can be landlords of our streets! It’s not theirs to sell!

    Delusional – every single one of them – about their “power”…..

    You still owe more to the mercenaries? You think any of us CARE to pay the ransom to save the wrecking crew rethugs?!

    ROTFL…

    Hate right back at you and FIRE in the belly to match yours…

    Oh, and have a lovely day :-)

  36. Charles Krauthammer (the man who calls conservative columnist David Brooks a “moderate”, yes try to stop your favorite soft drinking from shooting out your nose after hearing that, I couldn’t) is trying to blame the deficit on President Obama. Here is what I’m telling you folks, one look at this graph, and you know to blame President Obama for the deficit is a bold faced LIE.

    And if you can’t see in front of your own nose, here is the explanation of the graph here:
    http://www.cbpp.org/cms/index.cfm?fa=view&id=3490

    This is a graph that if the Democrat party has any brain cells left, and President Obama’s advisers don’t want the President to “play defense” for the next roughly 17 months, they will harp on and throw in the face of the voters until every person in America gets nauseated to look this graph.

    There is a question you must ask when looking at the above graph, and you think of Gramm–Leach–Bliley ( a largely Republican backed bill, which was railroaded through by Phil Gramm, who later went on to get a cushy do nothing job at UBS). See Barry Ritholtz analysis here:
    http://www.ritholtz.com/blog/2009/06/ubs-phil-gramm/

    The question is thus: If a black President had left the mess that “W” Bush left President Obama to clean-up, what would Republicans and people have said about that hypothetical President??? Let’s say the roles were reversed and a white President was taking the reins to clean up the black President’s mess??? I am here to tell you “no ifs, ands, or buts” that black President would today be considered worse than Jimmy Carter as far as his stigma on economics matters. And anyone who denies that, is either very naive about human character, or a damned liar.

  37. The words of UBS “vice-chairman”, and walking embarrassment Phil Gramm of Gramm–Leach–Bliley fame below. No word yet on whether Greece and Italy have sent their “thank you” note to Uncle Phil yet for the “prognosticative attributes” of swaps. Without swaps maybe those 2 countries would have no idea they were going bankrupt now….. maybe they could give Phil Gramm some medal of honor (or other gifts that cross their minds) next time Gramm travels through Europe????

  38. Read carefully the reports of budget deficit negotiations. They are working on a ten-year time horizon. I don’t see evidence that the administration is pursuing significant austerity measures for the short-term. (Jack Lew reportedly stated at a recent debt ceiling negotiation meeting that as to the “Biden Group’s” $1.5 trillion in cuts, only about $2 billion (with a B) would be in FY 2012.) They appear to be pursuing deficit reduction for the middle and out years of the ten-year window.

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