naked capitalism

russell1200 says:

Austria was land-locked by 1931. Germany was the builder of the 3 pocket-battleships.

The customs union is normally viewed as a problem with Germany and fear of German militarism. Austria was involved, but it seems unlikely that anyone was quaking at fear of them.

Are you sure France was a net creditor? I thought that part of the collapse came from France reneging on its war dept to the US.

The economic collapse was severe in Europe, but over for most the European countries much quicker than for the US. In part because it wiped out the war debt and the closely related German reparation payments.If it had not helped lead to the rise of the Nazis it is possible that from a European standpoint it would not have had the “Great” tag that we associate with it.

skippy says:

I’m lock step with you attempter, I wonder too, what thoughts Noam Chomsky has rolling around in his head these days. Seems the mad men hiding under the rocks of diminishment/obscurity are having a wee little chuckle to them selves.

Skippy…oly oly in-come free, tag neocons/economists your it.

Independent Accountant says:

YS:
Thanks for the Advanta piece. I said this about Citigroup and a $49 billion off balance sheet “error” about 17 months ago. The problem: CPAs which lack intellectual integrity and an SEC that wastes its time on trivia as opposed to investigating this stuff then making referrals to the Justice Department for securities fraud prosecution. Again, I ask, “Where is the PCAOB” on this?
The PCAOB shows what’s wrong with the entire concept of regulation, “regulatory capture”. The PCAOB is nothing more than a Big 87654 cartel enforcer.

Harlem Dad says:

Re: Cheney

What does Dick Cheney have on Obama? I’m starting to think that he’s the modern-day equivalent of J. Edgar Hoover.

Re: Buiter

He’s right. And the whole thing makes me feel helpless. We have Democrats in charge of both houses of Congress _and_ the White House … yet the failed policies of Republicans continue to rule.

Exactly why do I vote?

Tim in Sugar Hill

DownSouth says:

One has to admire Buiter’s idealism, to which I am certainly very much in agreement. But Buiter buys uncritically into some American myths, as well as an unrealistic conceptualization of human nature.

His quoting Patrick Henry, who certainly was no great champion of liberty, was a bad choice. For it was the unlikely team of opposites–Jefferson the romantic, Madison the realist–that laid the groundwork for our liberal, secular democracy. And the far more conservative Henry was more often than not one of their greatest adversaries in this endeavor.

The way in which Buiter invokes the Bill of Rights is also somewhat of a misfire. Buiter here is very much playing the role of the romantic, idealistic Jefferson. But it was Madison–the father of our Constitution–who gave our seminal governing document its grounding in reality, a reality very foreign to Jefferson’s Pollyanish concept of human nature. For Madison was very much aware of the paradox of democracy. As Lance Banning wrote in “Madison, the Statute, and Republican Convictions:”

Madison was deeply dedicated to the Revolutionary principle that governments derive their just authority from popular consent and must remain responsive to the people’s will. He was dedicated, too, to “justice,” by which he meant equality before the law and scupulous respect by government for natural law and natural rights… Bills of rights were not intended to protect some citizens from others, but to defend the whole society from the ambitions of its rulers. Theory and experience combined to make it difficult to understand how the majority, the greater number of the equals who composed the whole society, could will an act that would be inconsistent with the common good, which was their own. Only long experience with a disturbing train of measures could compel committed democrats to reexamine these assumptions, for the thought that the demands of the majority might be repeatedly at odds with justice and the long-term public good could force consistent thinkers to conclude that they might have to choose between the two commitments, neither one of which could be relinquished.~

Madison expresses the dilema in his own words, in a letter to Jefferson explaining why he was not initially inclined to worry that the recently completed Constitution did not include a bill of rights:

Repeated violations of these parchment barriers have been committed by overbearing majorities in every state. In Virginia I have seen the bill of rights violated in every instance where it has been opposed to a popular current… Wherever the real power in a government lies, there is the danger of oppression. In our government the real power lies in the majority of the community, and the invastion of private rights is chiefly to be apprehended, not from acts of government contrary to the sense of its constituents, but from acts in which the government is the mere instrument of the majority number of the constituents.~

Madison’s remedy to the democratic paradox was to “enlarge the sphere” of republican government. He concluded that a multiplicity of interests–and thus a large, diverse republic–is the most effective democratic safeguard for the rights of all. Implicit in his thinking of course was the need for a strong federal government.

Probably nowhere did we see the paradox play out more vividly than in the civil rights movement, where the racists were arguing “states rights” and the blacks were relying on a strong federal government to enforce their civil rights.

joebek says:

“Fear is a poor guide to policy. It caused the US to launch an unnecessary second war against Iraq …”. Buiter’s point about the dominance of irrational fear in the US following 9/11 is certainly incontrovertible. But I wonder if his conceit about the unnecessary war in in Iraq implies that he he believes the war in Afghanistan was truly a war of necessity. It is worthwhile considering whether or not the war in Iraq was strategically and even tactically more necessary in the GWOT than the war in Afghanistan. Now that the GWOT is over is difficult to imagine any rationale for continuing in Afghanistan. It’s lOCO.