The Daily Parker

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Fundamentally sound Hoover

Via Krugman, a good description of how the Bush-McCain economic program resemples the Coolidge-Hoover program that caused the Great Depression:

The real cause [of the Depression] was the collapse of the banking system, which followed the crash in part because Hoover believed strong fundamentals would protect the economy from disaster.

For the likes of Hoover and McCain, asserting the strength of fundamentals is shorthand for saying that business leaders, with maybe a little cheerleading, can sort out the crisis and that Congress should not try to regulate their behavior. It's too soon to know if McCain will be proved right (I doubt it), but Hoover certainly turned out to be wrong.

At the time, Sen. Robert Wagner, a New York Democrat, characterized Hoover's response to the crisis as "the time-worn Republican policy: to do nothing and when the pressure becomes irresistible to do as little as possible." In fairness, Hoover didn't quite "do nothing," but he followed a script that may sound familiar to students of the modern Republican Party.

Why does the name "Santayana" keep popping up in my head? (Third quote from the bottom, perhaps?)

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