Galbraith on the Bailout

Besides Robert Shiller, James K. Galbraith is another smart voice that should be given a seat at the table. He also recently authored a prescient book, called The Predator State: How Convervatives have Abandoned the Free Market and Liberals Should Too. He describes the corporate crisis and the necessary response for the state. A discussion of the book can be read over at TPMCafe, but residents of the Washington D.C. are invited to a session we are hosting with author on October 6th.

Galbraith also appears in today’s Washington Post, with an op-ed proposing an alternative to the bailout plan. Rather than a bank bailout, he proposes we focus on maintaining bank solvency, consumer protections, and managing the underlying housing crisis with the creation of a new institution capable of rewriting mortgages and overseeing the housing stock. He recognizes that we are in for an extended period of slow growth and suggests using real public spending to finance a new wave of sorely needed infrastructure investments. Finally, he believes it would be worth our while to start thinking about what we want the next economic recovery to look like and he suggests it should center on meeitng the challenges of energy and climate change. I agree.