Econ Wm Black: Treasury plan is 'greatest boondoggle in history'

Reading finance analysts Blodget-Black-Krugman-Stiglitz-Shiller-Johnson-Roubini-DeLong, an Obama supporter is left with the feeling: Jesus, I hope these guys are wrong about what Treasury Secretary Timothy Geithner is doing.

One of the problems is Geithner's Public-Private Investment Program (PPIP).

From TechTicker:

While much of the focus is on the stress tests and banks' efforts to raise cash, the real story is Geithner's Public-Private Investment Program (PPIP), says William Black, an Associate Professor of Economics and Law at the University of Missouri - Kansas City.

The PPIP is the 'greatest boondoggle in the history of the world,' says Black, a former bank regulator who was counsel to the Federal Home Loan Bank Board during the S&L crisis. As occurred during the S&L era, Black says the PPIP will allow banks to exchange 'trash for cash' and turn 'real losses into faulty gains.'

If the goal of Tim Geithner and other regulators was 'to rip off the American taxpayer for the benefit of the least-deserving wealthiest people you can imagine, well - mission accomplished,' Black says.

Among the masses and a growing number of economists is the distinct sentiment that what Obama and Geithner are doing is in a word: Wrong.

And boondoggling. Isn't that what the Republican geniuses who got us into this mess do?

What does that mean? That banks make a lot of money and the rules of the game have always favored capital?

We know that, that's kind of why many people get into finance: To make money. If this seems unfair, change the rules and start gearing American capitalism towards the middle class. Like soon.

One thing certain is that Obama needs to rebut these economists who are scaring the hell of a growing number of his supporters who just don't feel sufficiently conversant to understand or much less defend what is going on in the financial temples. And looking to the Recovery Accountability and Transparency Board doesn't seem all that revealing.

And by anecdote, some dudes sure seem confident that the DOW is going back down to 6,500 in the foreseeable future.

How bad is it? Tell me right away.

It's D-Day, Shiller, Roubini, Stiglitz, Kuttner and Krugman Sound Alarm

Just saying.

- Roubini's Pissed-Off and Stiglitz Goes Ballistic

- Robert Shiller: Depression Lurks Unless There’s More Stimulus

- Krugman: Green Shoots and Glimmers

- Kuttner: Will Obama's Economic Team Lead Him Off a Cliff?

Politically, it's time for a for-us or against-us ultimatum to the GOP while people still recognize that Bush and his GOP brought us to this mess. The TEA Party was a joke, for now.

But the idea that we have to try the recovery program now and then try something else, more comprehensive, in the Fall ain't going to work while the economy continues its slide and the GOP continues trring to appropriate unfocused frustration and aggression.

Be bold and great forces of the American people will come to your aid. "Choo-choos," as some the Tea Set derogated the labor-intensive high-speed rail project should be just the beginning of a massive public works program. [I know we have some begun now.]

And everyone knows that the fare of Robert Gibbs' “you will see in a systematic and coordinated way the transparency of determining and showing to all involved some of the results of these stress tests” didn't play and appears emblematic of opacity.

This recovery needs to be framed as Obama against Newt, Rush, Sarah Palin and the GOP.

Spook them [the GOP] , scare them [the public], shake the markets.

I know this more confrontational political strategy is being considered; well now it's D-Day, and Gen. Patton-Obama ought to lead the landing this time and all operations thereafter.

A Vision for High Speed Rail

Useful Idiots at the Capital

Update IV: MJS: Sign of anti-Obama protester reads "Keep your change. I'll keep freedoms. God bless the USA."

Update III: Time for TEA and a Fair Tax by Chuck Norris

Update II: Brian Beutler at Talking Points Memo has an insightful piece on the astroturf-nature of the the Tea Party event. In sum, no grassroots uprising, just a bunch of GOP activists [and locally with a few crazies from Fondy].

Update: Human Events magazine (of Newt, Dick Cheney, Rush, Ann Coulter renown) is promoting a "survival guide" warning that the Obama government is Preparing a Military Response to Coming Social Chaos. I swear these people are praying for a depression, a catastrophe, something disastrous. Was that a black helicopter that just flew over?
Does the GOP want a depression or are they just acting like it?

As Robert Shiller and other economists warn that absent “massive pump-priming” stimulus spending a depression looks increasingly possible, the GOP holds "tea parties," protesting stimulus spending, like today's at the state capitol building in Madison. [Paul Ryan is going to be there.]

The GOP says it's just looking out for the average taxpayer, without mentioning the Obama tax cuts for the vast majority of Americans and that little problem of a looming depression.

So watch the GOP hold their tea parties with Sean Hannity, Newt Gingrich, Rush Limbaugh and Glenn Beck cheering them on, while the country apparently can go eat cake.

Myself, I prefer the advice of the economists and the Obama administration who are trying to fix the mess.

From the Obama blog: "... in addition to the fundamental weaknesses of the economy, there is also a fundamental weakness in the political system that must be confronted."

That fundamental weakness in the political system is on display today as the GOP plays dress-up again, not as jet pilots like George W. Bush but as kamikazes.

Shiller: Depression Coming Without Bigger Stimulus

Update: Meanwhile the GOP stages AstroTurf (fake grass roots) events objecting to stimulus spending.

Robert Shiller pulls no punches in his Bloomberg piece; we need more stimulus spending and we may not get it.

In the face of a similar Depression-era psychology today, we are in need of massive pump-priming again. We appear to be in a much better situation due to the stronger efforts to date. Still, there is a danger that, because of a combination of faulty economic theory and inadequate appreciation of human psychology, as well as deep public anger, we will not continue with such stimulus on a high enough level. ...

Confidence is Key
Our theory of animal spirits is centered on confidence, and the vicious downward cycle of loss of confidence leading to decline in economic activity and then to more loss of confidence.

The next time you hear McCain, Ryan or Feingold bitch about earmarks or Michael Steele cry about spending, think: Depression.