E.J. Dionne knocks a home run in one of his best columns today in the Post. Regarding the Fed’s weekend $30 billion bailout of Bear Stearns, he starts off:
Never do I want to hear again from my conservative friends about how brilliant capitalists are, how much they deserve their seven-figure salaries and how government should keep its hands off the private economy.
And the heart of the matter:
As the economist John Kenneth Galbraith noted of the era leading up to the Depression, "The threat to men of great dignity, privilege and pretense is not from the radicals they revile; it is from accepting their own myth. Exposure to reality remains the nemesis of the great — a little understood thing."
Dionne said it much more eloquently than I could – finally, blind adherence to the “genius of the market” is facing cold hard reality. With investment bankers, it is the fact that they really didn’t know how much their investments in mortgages were worth. With healthcare, it is the fact that we spend at least twice as much as other wealthy countries and not only have a system that provides inferior care but can’t even manage to cover everyone.
Greed and excess in the health industry are driving our system and country into a ditch and, to get out, we are going to need some serious change. Calling in more market geniuses to fix our health system with high-deductible health plans, payday hospital loans, and incomprehensible tax credit plans won't work any better than, for example, the past year of justifications and reassurance from Bear Stearns executives about the financial system they helped create. Let's remember that the next time another highly-compensated insurance company executive tries to justify his salary with reference to the market.
Just because the idiots running the system into the ground are getting wealthy doesn't mean we aren't going to need government intervention to fix all their mistakes in the end.