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2.7%  Q1 GDP    4.57%  avg. 30-year mortgage     9.5%  Unemployment

Obama: We're In 'Era Of Profound Irresponsibility'

He's not even in office yet and President-elect Barack Obama has already christened the past several years and presumably the time we're still in as "The Era Of Profound Irresponsibility."

It's not quite Jimmy Carter's "National Malise" or Ronald Reagan's "Morning In America," but it'll have to do for now. (The Era Of Profound Irresponsibility could also describe The Ticker's college years.)

Obama is delivering what his aides have called a major economic speech right now at George Mason University in Northern Virginia where he's making the case for his up-to $800 billion government-funded economic stimulus plan.

If supply-siders and free-marketers were starting to warm up a little to Democrat Obama, with his promised tax cuts, they're probably recoiling in horror right now, based on something Obama just said: "Only government can break the cycle" of bad events that led the U.S. into the current economic crisis.

FDR, white courtesy phone please.

-- Frank Ahrens
The Ticker is Twittering!

By Frank Ahrens  |  January 8, 2009; 11:30 AM ET
Categories:  The Ticker  | Tags: Obama, economy, stimulus plan  
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Comments

When in heaven's name are we ever going to hold government (read that CONGRESS) responsible for their huge part in this mess? Business gets the lion's share of the blame. Bush gets blamed (since when did the POTUS becoming responsible for approving spending?). Individuals get scant blame for their willing participation in the credit market. Congress deflects all blame and we keep sending the clowns back in!!! Enough to drive one mad.

Posted by: Inquisitive1 | January 8, 2009 12:13 PM | Report abuse

Have people seen this article? Very similar viewpoint as above, but a little bit more pessimistic. Basically he's warning that it may soon be too late to save the economy. What does that even mean? Is that his way of covering for himself if he's unable to stop this mess?

http://greenfaucet.com/blogs/hanlons-pub

Posted by: macebruce | January 8, 2009 12:23 PM | Report abuse

this is just more Keynesian "something-for-nothing" garbage that Krugman preaches.

time to pay the piper.

Posted by: millionea7 | January 8, 2009 1:07 PM | Report abuse

The "Era of Profound Irresponsibility" began with the voting public's endorsement of Reagan's "voodoo economics." Yes, it was and is irresponsible to rely on voodoo to guide a nation's economy. American voters went for it, now they reap the harvest.

Posted by: guitar1 | January 8, 2009 1:13 PM | Report abuse

I am not an economist, but I suspect a simple version of what happened might be this. Banks and companies did not have to keep the mortgages they sold, so they didn't care about who could or could not pay it back. People got mortgages who shouldn't have, for 1st or investment homes. Banks sold and resold these mortgages to the point where the profit on the interest was finally reduced to nothing, just the mortgage value, and then dumped them on Fannie Mae and Freddie Mac.
If a company had to hold the mortgage they sold instead of getting rid of it within 5 minutes of the sale, things might be different. If this is true, and I was able to figure this out, those who knew much much better about how things were working should be ashamed of themselves. All these "instruments" were just a way to skim some profit and pass the mortgage on until the public held the risky mortgage. Too many people kept quet about this for too long. Where were the regulaters? I know there are also more complexities, but I bet this is part of what happened.

Posted by: jhogg | January 8, 2009 1:35 PM | Report abuse

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