Normally I would rip the Globe's Ideas to pieces; however, I'm not going to do that to this olive-branch column:
"So, you want to save the economy?; All you need is a keyboard and a few good ideas. Inside the influential new world of econobloggers" by Stephen Mihm | December 7, 2008
Stephen Mihm is a history professor at the University of Georgia and author of "A Nation of Counterfeiters."
DURING THE PANIC of 1907, the nation's most powerful banker, J. P. Morgan, brokered a solution to the crisis behind the closed doors of his personal library in New York City. Faced with the total collapse of the financial system, Morgan gathered together the nation's banking titans into one wing of the library and locked the door, refusing to let them out until they had pledged to help one another through the crisis.
Morgan stopped the panic in its tracks, and his modus operandi - hammering out deals in secrecy - has become the conventional method of managing threats to the nation's economy. This year, the response to the crisis on Wall Street started that way, too. As venerable Lehman Brothers teetered on collapse, the nation's top bankers gathered in the offices of the Federal Reserve for a closed-door meeting at which the Treasury secretary urged them to rescue the beleaguered firm on their own. When that effort failed, Secretary Henry Paulson demanded Congress cough up three quarters of a trillion dollars to buy up bad assets, submitting next to nothing to make his case. The message was simple enough: Trust us - we know what we're doing.
This time, however, something strange happened. A sprawling network of experts in economics and finance began picking apart the Paulson plan - live, in public, on blogs. Despite the vitriol the bloggers dished out - "Why You Should Hate the Treasury Plan" was one of the more temperate postings - this wasn't a bunch of hacks howling from the sidelines. Their numbers included some of the nation's top academic economists, such as Paul Krugman, Nouriel Roubini, and Tyler Cowen, along with a host of financial-industry insiders who actually knew a great deal about credit default swaps, collateralized debt obligations, and all the other esoteric instruments at the heart of the crisis.
As the bailout plan unfolded, the bloggers offered historical context along with cutting critiques of the proposal. More important still, they offered counterproposals: direct capital injections into banks, for example, or direct purchases of mortgages. Many of their readers began badgering their senators and representatives to oppose the plan. A few weeks later, Congress rebuffed Paulson, sending shockwaves through global financial markets.
Though it's still unclear how much credit the blogs can take for shaping Washington's response to the crisis, it's already evident that policy makers charged with monitoring and fixing the markets are no longer operating alone. A fast-moving, highly informed economics blogosphere now tracks and critiques their every move. The result is that this may be the first national crisis to be hashed out by experts in full public view.
The blogs offer a rolling crash course in economics as authoritative as any textbook, but far more accessible. It's a conversation that's simultaneously esoteric and irreverent, combining technical discussions of liquidity traps and yield curves with profane putdowns and heckling headlines. In the process, the bloggers have helped to democratize policy making, throwing open the doors on the messy business of everything from declaring a recession to structuring the most expensive government bailout in history....
Of course, he never mentions the ones you would see or read on this site.
In fact, here is his range of discourse and debate:
Everyone from conservative columnist David Brooks to liberal talk-show host Rachel Maddow....
EGADS!
--more--"
Now, I'm not an economics guy, and I often feel like this blogger:
"I can tell you that I don’t like reading about finance and don’t have much interest in it"
However, there are plenty of sites on my Must View sites you can go to for much better analysis than I can give, and the article doesn't mention them (as with so many other issues).
