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If Clinton = Coolidge, Bush = ?

July 25th, 2002

The imminent arrival of a US recession has led Republican sympathisers to intensify their efforts to pin the blame on the outgoing administration and its Wall Street allies, most notably Citibank, which employs former Treasurer Robert Rubin. The strategy is to paint Rubin as a latter-day Andrew Mellon (see below), the roaring 90s as a repeat of the roaring 20s and Clinton as Calvin Coolidge. The problem is to avoid the obvious corollary that Bush is Herbert Hoover and that we’re in for a repeat of the 1930s. The Republicans would prefer another identification, but, to paraphrase Lloyd Bentsen, “He’s no FDR”.

AndrewSullivan presents THE CASE AGAINST RUBIN, saying ” I can’t do better than reprint this email from highly astute reader and financial analyst:

You’re right. Rubin’s nefarious role in Enron and his overall responsibility in helping to create the bubble (along with Greenspan) has not received proper attention. In my opinion, Rubin is even worse than Greenspan. If you recall, he was the one who initially dismissed Greenspan’s “irrational exuberance” comments, and I believe he virtually created government for and by Goldman Sachs during his tenure in office. He frustrated the development of legislation to make the derivatives market more transparent (along with Phil Gramm), which could have prevented the Enron bankruptcy, and managed to get Brooksley Borne of the CFTC sacked when she pressed for such derivatives to be regulated by the Comex. He also cut the SEC’s budget by 60% when he was in office, which frustrated the fine work of Arthur Levitt and enabled many of the unsavoury practices now coming to light to be perpetuated. He was the architect of the strong dollar policy which helped to create such huge imbalances in the US current account in order to attract more money into the US capital markets and thereby create a hugely destabilising bubble. I suspect that Rubin will ultimately undergo a historical revision in reputation comparable to Andrew Mellon (who in 1928 was viewed as the greatest Treasury Secretary since Alexander Hamilton and left office in disgrace in 1932). Rubin was smart enough to get out before things got really messy, but he is even more culpable than Mellon.
I think we’re due for a major re-evaluation of the Clinton-Rubin-Greenspan legacy, don’t you?”

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