Wednesday, August 17, 2011

This is Reaganesque, in a Texas sort of way

I don’t intend to be piling on here, and I still haven’t read enough about Perry to make a recommendation one way or another, but this is precisely the sort of conversation that those in the U.S. government need to be having about economics and monetary policy.
The Texas governor, who by some polls is the new Republican presidential frontrunner, went on to say, “We’ve already tried this. All it’s going to be doing is devaluing the dollar in your pocket. And we cannot afford that.”

Well, to me that is exactly right.…

… it turns out that Governor Perry -- even with his overly strong language -- is a pretty sharp economic and monetary analyst.

In fact, Perry’s analysis actually channels recent Fed dissents by reserve-bank president’s Dick Fisher of Dallas, Charles Plosser of Philadelphia, and Narayana Kocherlakota of Minneapolis. They object to a two-year extension of the Fed’s zero-interest-rate policy, and in so doing have set down an opposition marker to a potential new shock-and-awe quantitative easing that many fear will be announced on August 26 when Bernanke speaks to the Jackson Hole Fed conference.

What makes Governor Perry’s position even more interesting is his disagreement with former governor Mitt Romney. When I interviewed Mr. Romney this past April, he essentially defended Ben Bernanke and dollar depreciation. “Well, you know, I think Ben Bernanke is a student of monetary policy,” Romney said. “He’s doing as good a job as he thinks he can do in the Federal Reserve.”

Meanwhile, in Tea Party circles on the campaign trail, Mr. Bernanke is a much disliked figure. Rightly or wrongly he is blamed for bailing out Wall Street. Also, many view Bernanke’s massive money-creation, along with President Obama’s massive federal-stimulus spending, as another failed big-government attempt to revive the economy.

Tea partiers and many others fervently believe in lower spending, reduced tax burdens, and a regulatory rollback to strengthen small businesses and the private economy. They’re against Uncle Sam just throwing money at problems.

So in this sense Governor Perry’s red-hot riposte at Bernanke may be shrewd politics, as well as a much needed defense of stable money….
Edit at 9:40 am: I forgot the link to the article that this was taken from:

1 comment:

  1. Need some more time with Perry as well. I just don't trust any of these guys, except Ron Paul, who is quite honest and up front, though his foreign policy may be weak.

    BTW, I love that photo of Ron. What a great president he was.