April 21, 2009
If you haven’t read economist Simon Johnson’s piece in this month’s Atlantic, find some time this weekend to do so (We’ll post some excerpts here later today).
Johnson’s the former chief economist at the International Monetary Fund, and he outlines what he sees as the alarming influence of Wall Street firms over the American economy. I interviewed him on TechTicker yesterday, and he expounded on his thesis:
America’s Crisis Resembles that of Emerging Markets: While at the IMF, Johnson saw so many financial crises that the core problem became old hat: In the free-wheeling growth years of an economic boom, the politicians and oligarchs of an emerging market like Russia or Argentina would get so close that eventually they would meld into a politico-industrial complex. As long as the boom lasted, this cozy relationship never bothered anyone–because everyone was getting rich. Fast forward to the latest market crisis–the one in the United States. The pattern is exactly the same, with a two-way money-and-power corridor now running between Washington and the modern oligarchs Wall Street.
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