Martin Wolf on Geithner’s plan …
Has Barack Obama’s presidency already failed? In normal times, this would be a ludicrous question. But these are not normal times. They are times of great danger. Today, the new US administration can disown responsibility for its inheritance; tomorrow, it will own it. Today, it can offer solutions; tomorrow it will have become the problem. Today, it is in control of events; tomorrow, events will take control of it. Doing too little is now far riskier than doing too much. If he fails to act decisively, the president risks being overwhelmed, like his predecessor. The costs to the US and the world of another failed presidency do not bear contemplating.
I’m not sure I agree 100% because I still see this fundamentally as a punt. And as some point out there are kernels in here of what could be a good plan. But I think the fundamental point is right on. Bank bailouts are catastrophic in political terms and much more important, in the Paulson/Geithner model, probably won’t work either. That’s a bad combination. At some point, Obama owns this.
