I’ve mentioned before that, while being a blogger makes me an expert in all sorts of things that I’m not, the interconnectedness of global finance gives me a headache. And while I’m as anti-bailout as the rest of you, I allow for the fact that there’s a lot I don’t know. I rely on people smarter than me to make sense of the nonsensical.
One of the columnists I rely on is Robert Sammuelson, a right leaning economics writer for the “Washington Post.” Rep. Paul Ryan is always sharing links to his writing, and he always males a great deal of sense whether it be jobs, health care reform, stimulus, etc. Granted it’s usually positions I agree with in the first place. He just explains to me why.
So imagine my surprise when he came out in FAVOR of bailing out Europe…
America’s interest lies in preventing a repetition. We ought to support Europe’s rescue package. Europe’s problems aren’t its alone; markets are global. In 2009, U.S. bank lending to Europe was $1.5 trillion. This larger lesson seems lost on the U.S. Senate. Just the other day, it voted 94-0, in a largely symbolic gesture, to limit American participation, through the International Monetary Fund (IMF), in the European rescue. That may be good politics, pandering to populist hostility to “bailouts.” But the overt nationalism could shake confidence and backfire on everyone.
He then goes on to describe the three part “Europe Rescue Plan.” Give the whole article a read. It’s an interesting point, especially when most of our reactions to the word “bailout” involves us running around the table with our fingers in our ears saying, “I’m not listening.”