Thursday, March 26, 2009

Congresswoman Bachmann Questions Geithner & Bernanke

 to After I commented on the bill by Congresswoman Michele Bachmann to ban the replacement of the dollar, I came across this YouTube video of her questions to Geithner and Bernanke.

I think we have a star in the making. She sure looks sharp to me.

She is going to need a bit of tutoring around edges of the basics of finance and economics, but she will pick it up fast. I understand she is part of Ron Paul's Liberty Committee.


  1. Constitutionalist party for US 2012 election? Now that would be something, wouldn't it?

  2. We need more like Congresswoman Bachmann. It’s mind numbing what Geithner and the Administration is seeking to accomplish as far as more government control of every sector of life. Add into that the majority of folk in Congress while I’m at it.

    Did you see this article:
    UN panel touts new global currency reserve system

    You know our government is at least considering the idea. When Geithner slipped the other day and said he was open to the idea and then backtracked it was just evidence to me that the idea is floating around in discussion. The foreign countries can’t afford to bail us out any more and the piper is going to ask his due.

    A side note: I was watching gold with the widget when Geithner made his slip. The price rocketed like someone lit a fuse to a rocket. Then when he clarified it the price came back down. Just proves to me how much unease and fear there really is in the markets.

  3. I "like" Bernanke's answer about "stigma".

    On the one hand all sorts of emergency measures are pushed through under a vague fear of "systemic risk". Exactly what is supposed to happen is not made clear, but the general idea of "systemic risk" is that big failures will domino out knocking down sound financial institutions. Good ones along with unsound ones, So the bailouts gotta come. So the story goes.

    Yet the public can't find out who the Fed is 'opening the window' to, because it might "stigmatize" those who borrow from the Fed.

    Isn't there a contradiction here?

    Surely the public ignorance this situation ensures only makes "systemic risk" more likely. After all if the public does not know who is being loaned to, they will assume the whole industry is in a mess. The secrecy of Fed measures undermines rather than reassures.

    Justice Louis Brandeis said "Sunlight is the best disinfectant". That holds for toxins too.

    They fear that knowledge of individual bank/Fed transactions wil do harm. These guys are talking about "dangerous ideas". Maybe they should read linguist Steven Pinker's article "In Defense of Dangerous Ideas" and see if it has application to the financial regulation.

    This paragraph from Pinker seems particularly apt:

    "'s hard to imagine any aspect of public life where ignorance or delusion is better than an awareness of the truth, even an unpleasant one. Only children and madmen engage in "magical thinking," the fallacy that good things can come true by believing in them or bad things will disappear by ignoring them or wishing them away. Rational adults want to know the truth, because any action based on false premises will not have the effects they desire. Worse, logicians tell us that a system of ideas containing a contradiction can be used to deduce any statement whatsoever, no matter how absurd. Since ideas are connected to other ideas, sometimes in circuitous and unpredictable ways, choosing to believe something that may not be true, or even maintaining walls of ignorance around some topic, can corrupt all of intellectual life, proliferating error far and wide. In our everyday lives, would we want to be lied to, or kept in the dark by paternalistic "protectors," when it comes to our health or finances or even the weather? In public life, imagine someone saying that we should not do research into global warming or energy shortages because if it found that they were serious the consequences for the economy would be extremely unpleasant. Today's leaders who tacitly take this position are rightly condemned by intellectually responsible people. But why should other unpleasant ideas be treated differently?"

    The Obama administration has made some strong statements in defense of "Open Government".

    "...My Administration is committed to creating an unprecedented level of openness in Government. We will work together to ensure the public trust and establish a system of transparency, public participation, and collaboration. Openness will strengthen our democracy and promote efficiency and effectiveness in Government...".

    Well what about here? If there is going to be a big increase in the extent of federal regulation, surely it is not unreasonable that those regulators and their activities be made both more transparent and accountable??