EMAIL SIGN UP!
Most Popular This Week
- US Is an Oligarchy Not a Democracy, says Scientific Study
- DOJ Investigation Confirms: Albuquerque Police 'Executing' Citizens
- What Do the Koch Brothers Really Want?
- Tutu: Climate Crisis Demands 'Anti-Apartheid-Style Boycott' of Fossil Fuel Industry
- Pulitzer Vindicates: Snowden Journalists Win Top Honor
Today's Top News
Bill Clinton, the Person Who Set the Economy on Its Bubble Driven Path, Has Economic Advice for the Country
The Post reports on a new book by President Clinton which offers economic advice to the country. While the book notes in passing that Clinton's policies contributed to the economic crisis by deregulating Wall Street, it failed to point out that Clinton's policies were actually central to the disaster the economy is now facing.
Clinton promoted both the growth of the stock bubble and the over-valuation of the dollar. The latter came about when his administration organized the "saving" of East Asia following its financial crisis in 1997. The harsh terms of the bailout required the countries of the region to run huge trade surpluses in order to meet their payments. This meant raising the value of the dollar against their own currencies.
Other developing countries wanted to avoid ever being in this situation so they too began to accumulate reserves at a huge pace after 1997 by keeping down the value of their own currencies against the dollar. This led to the huge run-up in the dollar and therefore the large trade deficit that we saw in the last decade and continue to see today.
The demand gap created by the trade deficit was filled by the housing bubble in the last decade. With the bubble now burst it can only be filled by government budget deficits until the dollar falls enough to bring trade closer to balance. Given the enormous disaster that resulted from his economic mismanagament (which could have been reversed had anyone in the Bush administration been awake), it is highly ironic that President Clinton would write a book offering economic advice to the nation.