Let's imagine that the economy in Venezuela gets really bad in the next few years. Will the Post write about how Hugo Chavez had to cope with enormous economic turmoil? That's unlikely. The Post would most likely be running articles that tell readers how Chavez's policies led to an economic disaster. But, a different standard is applied to our economic chieftains who pursue policies that the Post endorses. The first part of a two-part profile of Treasury Secretary Henry Paulson's actions in the crisis is headlined "A Conversion in 'This Storm.'" The headline implies that the economic crisis is something that came out of the blue as opposed to being an entirely predictable result of the economic policies pursued by Paulson and his predecessors. The point is extremely simple. There was a huge housing bubble that should have been visible to any competent economic analyst. The bubble was fueled by an enormous chain of highly leveraged finance. (As head of Goldman Sachs, Mr. Paulson personally made hundreds of millions of dollars from this bubble.) It was entirely predictable that the housing bubble would burst and that its collapse would have a huge impact on the financial system and the economy as a whole. There is zero excuse for Paulson being caught by surprise by a "storm" that he helped create. The Post should not be in the business of covering up for Paulson's massive failure.
--Dean Baker
