By Matthew Vadum ——Bio and Archives--April 10, 2009
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But President Obama “lost a great opportunity” by not taking a more radical approach in dealing with the banks, Soros says. “There’s too much continuity with the bumbling and mishandling by the previous administration. Not enough discontinuity.” Specifically, Soros wanted Obama to “come out of the gate with a well considered plan” to recapitalize the banks, rather than continuing with the TARP and related bailouts. But the President may have been hampered by his desire to create consensus, Soros says. “The nature of far from equilibrium situations is that public understanding is always lagging behind events. If you’re guided by desire to have consensus, you’ll always be a little bit slow.” Essentially, Soros believes we should be following the so-called Swedish solution but fears we are heading down the same policy path as Japan. “We’re effectively keeping zombie banks alive,” he says. To those who rail about the dangers of nationalizing banks, Soros says: “You have to recapitalize the banks for them to function. As it is, we are nationalizing the debt of the banks, but not the banks themselves.” [...]About the only thing true words that might have escaped Soros’s lips were contained in his observation that “American over-consumption cannot be the motor of the world economy.” Everyone will have to learn with live within his or her means. Now that American businesses and the American people are being forced to cut back, one day the bloated U.S. government will have to follow suit. Dare to dream.
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Matthew Vadum, matthewvadum.blogspot.com, is an investigative reporter.
His new book Subversion Inc. can be bought at Amazon.com (US), Amazon.ca (Canada)
Visit the Subversion Inc. Facebook page. Follow me on Twitter.