My economic qualifications are confined to a DNS in year 12 which puts me way ahead of most US congressmen. Anyway, my view (FWIW) is that the US financial crisis will resolve itself satisfactorily, probably in the short term.
The Left are correct in describing this as a crisis of capitalism – but the truth is that capitalism will survive. This is not 1929 and nothing like it. I expect a variant of the bailout legislation will be passed by Congress shortly.
In the same way that Republican representatives voted against it because of the perceived opposition in their electorates, the impact of the failure of the bailout legislation is plain for all to see. That will change their minds provided the new bailout can save their face.
This is not so much a problem inherent in capitalism but one in the structure of US government. This type of crisis needs prompt and decisive action which the US political structure prevents. Despite the fact that Paulson, Bush, McCain and Hussein Obama all support bailout, the issue has been left for decisions by elected US politicians. I support democracy but this demonstrates its limits.
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Other countries have a more unified leadership system, especially ones that adopt the British system. In Australia, it would be a bipartisan decision with effective power in the executive, not the ranks. The test for these propositions is to imagine that Australia had the US presidential system. In that event, the question of a bailout would be decided in the Senate by Senator Fielding — a frightening thought for all.
So the Left should not open the champagne just yet. It should get back to more serious issues like global warming, which apparently Rudd and Garnaut are going to fix by the public ceasing to eat f-rting animals like cattle and sheep in favour of eating nonf-rters like kangaroo. The whole world is crazy.