Springtime for Bankers
May 22, 2014
By any normal standard, economic policy since the onset of the financial crisis has been a dismal failure. It’s true that we avoided a full replay of the Great Depression. But employment has taken more than six years to claw its way back to pre-crisis levels — years when we should have been adding millions of jobs just to keep up with a rising population. Long-term unemployment is still almost three times as high as it was in 2007; young people, often burdened by college debt, face a highly uncertain future.
Now Timothy Geithner, who was Treasury secretary for four of those six years, has published a book, “Stress Test,” about his experiences. And basically, he thinks he did a heckuva job.
蒂莫西·蓋特納(Timothy Geithner)最近發表了一本名為《壓力測試》(Stress Test)的書，講述了他的經歷。這六年間，有四年他在擔任財政部長。總體而言，他認為自己極其出色地完成了任務。
He’s not unique in his self-approbation. Policy makers in Europe, where employment has barely recovered at all and a number of countries are in fact experiencing Depression-level distress, have even less to boast about. Yet they too are patting themselves on the back.
How can people feel good about track records that are objectively so bad? Partly it’s the normal human tendency to make excuses, to argue that you did the best you could under the circumstances. And Mr. Geithner can indeed blame much though not all of what went wrong on scorched-earth Republican obstructionism.
But there’s also something else going on. In both Europe and America, economic policy has to a large extent been governed by the implicit slogan “Save the bankers, save the world” — that is, restore confidence in the financial system and prosperity will follow. And government actions have indeed restored financial confidence. Unfortunately, we’re still waiting for the promised prosperity.
然而，還存在一些另外的情況。在歐洲和美 國，很大程度上主導經濟政策的是這樣一種隱含的口號：「挽救銀行從業者，就挽救了全世界」——也就是說，恢復了金融體系的信心，經濟繁榮就會隨之而來。政 府採取的行動的確已經恢復了金融信心。不幸的是，我們依然在等待許諾中的經濟繁榮。
Much of Mr. Geithner’s book is devoted to a defense of the U.S. financial bailout, which he sees as a huge success story — which it was, if financial confidence is viewed as an end in itself. Credit markets, which seized up after Lehman fell, mostly returned to normal during Mr. Geithner’s first year in office. Stock indexes rebounded, and have hit new records. Even subprime-backed securities — the infamous “toxic waste” that was poisoning the financial system — eventually regained a significant part of their value.
Thanks to this financial recovery, bailing out Wall Street didn’t even end up costing a lot of taxpayer money: resurgent banks were able to repay their loans, and the government was able to sell its equity stakes at a profit.
But where is the rebound in the real economy? Where are the jobs? Saving Wall Street, it seems, wasn’t nearly enough. Why?
One reason for sluggish recovery is that U.S. policy “pivoted,” far too early, from a focus on jobs to a focus on budget deficits. Mr. Geithner denies that he bears any responsibility for this pivot, declaring “I was not an austerian.” In his version, the administration got all it could in the face of Republican opposition. That doesn’t match independent reporting, which portrays Mr. Geithner ridiculing fiscal stimulus as “sugar” that would yield no long-term benefit.
經濟復蘇步履蹣跚的一個理由是，美國政策 過早地「轉向」，將關注點從就業轉到預算赤字。蓋納特否認他對這種轉向負有任何責任，反而宣稱：「我不屬於緊縮派。」按照他的說法，面對共和黨人的反對， 奧巴馬政府已竭盡所能。這種論調與獨立報道相左：在這些報道中，蓋特納曾嘲笑，財政刺激是不會產生長期效益的「糖果」。
But fiscal austerity wasn’t the only reason recovery has been so disappointing. Many analysts believe that the burden of high household debt, a legacy of the housing bubble, has been a big drag on the economy. And there was, arguably, a lot the Obama administration could have done to reduce debt burdens without Congressional approval. But it didn’t; it didn’t even spend funds specifically allocated for that purpose. Why? According to many accounts, the biggest roadblock was Mr. Geithner’s consistent opposition to mortgage debt relief — he was, if you like, all for bailing out banks but against bailing out families.
“Stress Test” asserts that no conceivable amount of mortgage debt relief could have done much to boost the economy. But the leading experts on this subject are the economists Atif Mian and Amir Sufi, whose just-published book “House of Debt” argues very much the contrary. On their blog, Mr. Mian and Mr. Sufi point out that Mr. Geithner’s arithmetic on the issue seems weirdly wrong — order of magnitude wrong — giving much less weight to the role of debt in holding back spending than the consensus of economic research. And that doesn’t even take into account the further benefits that would have flowed from a sharp reduction in foreclosures.
《壓力測試》中強調，任何合理規模的按揭 債務減免都不可能對經濟有多少促進作用。然而，從事這方面研究的著名專家阿蒂夫·米安(Atif Mian)和阿米爾·蘇菲(Amir Sufi)剛剛出版了新書《債務屋》(House of Debt)，其中的觀點與之大相徑庭。米安和蘇菲在博客中指出，蓋特納在這個問題上的計算錯得離譜——是數量級有誤——在量化債務在阻礙支出方面的作用時，他賦予債務的權重遠遠低於經濟學研究中的共識。而且他還沒有考慮到，止贖事件大幅減少本可能帶來的更多好處。
In the end, the story of economic policy since 2008 has been that of a remarkable double standard. Bad loans always involve mistakes on both sides — if borrowers were irresponsible, so were the people who lent them money. But when crisis came, bankers were held harmless for their errors while families paid full price.
And refusing to help families in debt, it turns out, wasn’t just unfair; it was bad economics. Wall Street is back, but America isn’t, and the double standard is the main reason.
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