YOU CAN LEARN A LOT FROM A 92 YEAR OLD, ET. AL.

10/18/08

It has been a long time since I’ve enjoyed the Wall Street Journal’s editorial page. What once was the nation’s clearest and most articulate advocate of the principals of free men and free markets has metamorphosized into a jejune purveyor of meretricious and shameless closed-eyed cheerleading for the Bush administration and the GOP, even as both have thoroughly betrayed the principals that the Journal has long advocated and continues to insist it fervently holds.

This morning’s (i.e., 10/18-10/19’s) editorial page of the Journal, however, was perhaps the best I have read in the last ten years and, for once, I was delighted that my Saturday was not thoroughly consumed with our kids’ soccer games so that I could spend some time with my erstwhile friend from Wall Street.

A few of this morning’s articles, “Most Pundits Are Wrong About the Bubble” by Professor Charles W. Calomiris of Columbia and an editorial entitled “Another ‘Deregulation’ Myth,” by the Journal’s once redoubtable, but now largely insipid, editorial staff attempt to make the case for deregulation of the financial markets. They do so clumsily, by, for example, arguing that the implementation of Basel II standards for financial institutions argues that regulation was responsible for our financial mess while ignoring, based on facts cited in these articles themselves, that Basel II was, in fact, an instance of aggressive deregulation. Mr. Calomiris makes the same logical error while also proposing for a minimum subordinated debt requirement for financial institutions in an article that ostensibly advocating deregulation and arguing that unregulated activities of banks (subprime lending, securitization, and dealing in swaps) that got the banks into trouble indeed advance the point that regulation is what has gotten the markets into trouble. These are clumsy arguments in favor of a case that is currently hard to make (and may always be hard to make, sad to say) and, in fact, end up contradicting themselves, but at least these two articles provide plenty of information that is worth reading and take the Journal’s traditional side of an especially salient philosophical debate. They also expose how illogical the Journal has become in its pursuit of one of the few ideas it has yet to throw under the bus.

Peggy Noonan’s article, “Palin’s Failin’” is perhaps the greatest that the estimable Ms. Noonan has ever produced, not so much for her observations, best encapsulated by “…there is little sign that (Palin) has the tools, the equipment, the knowledge or the philosophical grounding one hopes for, and expects, in a holder of high office,” but rather for long time conservative Noonan’s observation that “If (self-styled conservatives) stood for conservative principles and the full expression of views—instead of attempting to silence those who opposed mere party—their movement, and the party, would be in a better, and healthier, position.” Then, fully expecting the kind of treatment Christopher Buckley received from those who purport to be acolytes of his father, Ms. Noonan ends her article with “…come and get me, copper.” It’s too late for this erstwhile conservative Republican; while I hate to use words like “never,” it’s going to be very difficult for me to vote for any Republican for any office after what George Bush has taught us about the GOP’s real motivation, and I don’t even call myself “conservative” any more after what Mr. Bush and his cheerleaders have done to our movement and, more importantly, to our county. But those of you who still call the GOP, and/or the conservative movement, home would do well to listen to Ms. Noonan and to respect her courage. But most GOPers won’t; they’ll simply accuse her of being a “liberal,” a “statist,” an “elitist,” and, who knows, perhaps a “terrorist sympathizer.” The Journal can be counted on to, perhaps indirectly but certainly snidely, join in such criticism.

The best article in today’s Journal, however, was an encapsulation of an interview of Anna Schwartz, who was the co-winner of Milton Friedman’s Nobel Prize for “A Monetary History of the United States,” and who, at 92, still works for the National Bureau of Economic Research, as she has since 1941 and who remains as sharp, and as unruffled, as ever. In this article, she argues four square against the Journal’s stance on the government interventions we have seen over the last several months in its doomed efforts to “rescue” the financial markets. She argues persuasively against the bailouts, against treating irresponsible lenders with more deference than irresponsible stockholders, and that “Everything works much better when wrong decisions are punished and good decisions make you rich.” Would that the Journal had not abandoned such wisdom the moment George W. Bush became president!

At any rate, try to get your hands on the 10/18-10/19 Wall Street Journal and read the aforementioned articles. Not only are they entertaining and informative, but they are brutal testimony to how far from the principles of free men and free markets the Journal has come.