I'm at the CUNY Grad Center/Economic Study Group conference on the 10th anniversary of the financial crisis, and will try live-tweeting until my own panel goes on 1/ esg.gc.cuny.edu/event/perspect…
Huh -- Merih Uctum tells us that the Greek root of "crisis" means the point in a disease when you turn either toward recovery to toward death. Still not sure what 2008 was 2/
Jesse Eisinger says that while he saw clear trouble in late 90s, and again in the mid-2000s, but doesn't see a crisis looming now 3/
Andrew Ross Sorkin says that leverage is what's dangerous, and not so much right now, although we may have buildup where we don't see it 4/
Rana Foroohar: how big a deal is it that nobody went to jail? Eisinger: we didn't hold bankers accountable. Used to be a cost to blowing up institution; now they still get to talk to Andrew Ross Sorkin. Destroys legitimacy of system 5/
Sorkin: more accountability wouldn't have changed the politics. Electorate is always radicalized after a crisis. Also underlying issues like wage stagnation. Also there weren't enough smoking guns to have had prosecutions 6/
Eisinger -- some of the civil prosecutions could have been criminal; not enough resources put in; Department of Justice corrupted by revolving door, it's become a training ground for future corporate defense attorneys 7/
Eisinger: political failure on part of Democrats. Central failure was not bailing out homeowners. Why? Democratic party was funded by wealthy and corporations, triangulating. Geithner with corporate.bankers ethos. That ethos on steroids under Trump 8/
Sorkin: Democrats too reticent to go big. But Republicans completely obstinate. Obama went after health care, could have focused on other things. Higher capital requirements cut against trying for fast recovery 9/
Austerity: Faroohar asks Eisinger. Eisinger: Obama embraced austerity, entitlement reform. Terrible political mistake. Obama/Summers moved to the Republicans. GOP implacable opposed 10/
Housing relief could have been much more aggressive. Capital requirements not really a problem. Opportunity was there. 11/
Sorkin: what could have changed the politics? Economic position better than we could have expected. Not as good as it should have been, but better than Rogoff/Reinhart would have predicted (actually I don't think that's right) 12/
Both speakers: Bernanke/Paulson missed the whole thing ("contained") Stabilized capital markets but ... Obama relied on Geithner too much. 13/
Sorkin: paid AIG bonuses, gave banks 100%. But it was done to instill confidence, and they didn't feel there was an alternative Eisinger: saving institutions versus system 14/
Faroohar: is the system safer? Eisinger: we didn't break up the power. Dodd-Frank was a technocratic response not a fundamental attempt to change the system. Eisinger -- we should have had broad-brush regulations even if they were crude 15/
Sorkin: we could have a good discussion about bank regulation given current state of the economy. Things we could have done better wouldn't have made much difference to recovery 16/
I asked why Obama didn't use reconciliation to get a bigger stimulus. Both Eisinger and Sorkin basically blame hope and change: Obama was trying to be bipartisan (and pussyfooted on health care until Pelosi stepped in) 17/
Eisinger: Dodd-Frank not a big deal and being unwound. 18/
Subprime auto? Student debt? Faroohar: not systemic, but wage stagnation underlies these debt problems. She thinks student debt is bigger than auto; NY Fed says it's a headwind for consumption and growth 19/
Faroohar: what kind of financial system do we want to have? Sorkin: we're yearning for the American dream, but that was an aberration. Rest of world was out of business (I hate this argument!!) 20/
I've written repeatedly about the argument that we were doing well because the world was in ruins. It's a really, really bad argument 21/
Eisinger: we've made our over-financialized system even more so. Global authoritarian threat because of timidity on left and ruthlessness of right. Economy secondary to social threat 22/
Jeff Sachs on video from Korea -- but I don't think that's allowed unless a small child walks into the room while you're speaking 23/
Here's something I wrote about the claim that we did well in the 50s because the world was in ruins krugman.blogs.nytimes.com/2012/11/19/the… 24/
Jeff Sachs still doesn't believe in fiscal policy, still implicitly defending austerity. Sigh 25/
Sachs: we need financial supply side in our models, credit availability. Keynesian models bah humbug. I think that's his message 26/
