Washington, DC – March 28: (LR) White House Deputy Chief of Law, Political and Political … more
In his classic book Lombard Street19th -century economic writer Walter Bagehot observed that because of the unjustified prestige associated with central banks, positions within tend to “want in vain men, by lazy men, from men of class”. President Trump, or those close to Trump, would be wise to take into account Bagehot’s words, as they consider Jerome Powell’s possible replacements, including Kevin Hassett.
Traveling back in time to 2005, a New York Times Ben Bernanke’s profile from the same year included surprised by Bernanke’s closest friends for his political relationship. Specifically, they had no idea that he was a Republican.
Bernanke divergence is useful as a way to paint Bagehot’s words. Bernanke was not going to let political affiliation hinder the final prize for economists, president of the Federal Reserve.
It’s something you have to remember with the Hassett mind. As it seemed to be with Bernanke, he has shown a flexibility (see recent Washington Post piece For more details) on the financial issues that signify alarming ambition of the genre warned by Bagehot. Beyond Position Resolution, just think about his recent interview with Abc’s Jonathan Karl for Brazil and the planned imposition of President Trump’s invoices on the nation of South America. Karl specialized the obvious contradictions in Hassett’s defense of Trump’s attitude.
What is important about what Hassett said on national television is that he knows better. This does not mean that his financial views are flawless. Far from it, if we are realistic. You are simply traveling back in time until 2010, when, as a supposed solution to hypotonic unemployment, Hassett worked with left -wing economist Dean Baker to make a rather French job for “exchange”. In the words of Baker and Hassett,
“As part of a job exchange program, businesses are encouraged by government policy to spread a small amount of pain to many workers. In a formal arrangement, an employee can see the weekly hours reduced by 20%and his salary decreases by about 4%.”
It seems that bad ideas never die, regardless of the basic history that tells us that unemployment has nothing to do with how much or how few people are looking for employment. No, Hassett’s finances are not perfect. Fast forward by 2017, in an interview with Political Ben White during which Hassett expressed fear Once again about unemployment, he told White “is such an urgent problem that government programs that hire people directly can be part of the solution.” Governments that export money from the private sector to hire public sector workers? No thank you.
Still, Hassett’s past comment more than anything seals as a middle road economist, and when the average economists look in the mirror, they see government solutions written by themselves. It is far away to say that Wrongheed as a “exchange of work” and “government hiring” is, it would be difficult to find many economists who will not move Hassett’s delusions. Their finances are persecuted by them.
It is a way to say that while Hassett’s economic orthodoxy will not exclude him for the top role of the Fed, his willingness to say anything, including that there is ‘Patriotic’ quality In Trump’s invoices, undoubtedly must Block him. He should just because Hassett knows better again.
This means that his interest in the Fed presidency goes beyond his willingness to remain firm in the most basic economic principles. Be careful for such a person so publicly willing to achieve significant rankings, including the top position for economists. As Bagehot said about those politicians about the situation, “these men are dangerous.”
