There’s little doubt that Hank Paulson, Tim Geithner and Ben Bernanke all played substantial roles in the build-up of the 2008 financial crisis. After all, Paulson was in charge of Goldman Sachs, the lead horse during one of Wall Street’s greatest speculative run-ups ever. Geithner played a key role at the NY Fed, an agency designated as one of the primary regulators of the very banks who nearly imploded the economy. And then there was Ben Bernanke who was utterly asleep at the wheel as he drove the economy off a cliff in 2008.
So I am befuddled when smart people keep claiming that these men deserve some debt of gratitude. My friend Mark Dow (someone I almost never disagree with) says we should all thank them:
“The bottom line is this: it worked wildly better than anyone could have hoped for—even for those of us who thought at the time it was the right course of action. Markets were stabilized, the private sector banking system was recapitalized at the end of the day with private sector money, and the US taxpayer pretty much got it for free—whatever you think the final bill will turn out to be. Anyone still trying to move the goalposts should be gently reminded that reality disagrees.
So, go ahead. Today is the right day to say it. Thank you Tim Geithner. Thank you Ben Bernanke. Thank you Hank Paulson. We were wrong. You were right.”
I don’t know about you, but when someone burns down your neighborhood, then helps rebuild it, you don’t turn around and praise them for their good work. Not to mention, the neighborhood we seem to have these days is a mere facade of the one we once had….Thanks? No thanks.