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To: Oblomov who wrote (89257)	10/27/2008 1:22:50 PM
From: koan	Read Replies (3) \| Respond to of 116555

koan: Doing nothing was what Hoover did and students of the great depression said that was the major failing. By the time FDR did something 3.5 years later, 1/3 of all banks had gone under along with people's money and we had between 25 and 40% unemployment and peope were starving and their lives were hell. Hoover was advised to let the depression run (sort of your philosophy I guess) and it would get rid of the "dead wood". The government cannot just let its people starve to death!! That philosophy is fine if you are a sociopath. In 1987 one day after the debacle the fed flooded the market with liquidity and we went on our merry way. To do nothing assumes humans have no ability to manifest their own destiny with knowledge. That economics cannot be understood. Good thing our founding fathers didn't feel that way when they broke away from England and formed theconsitution. Oblomov: >> No, I do not have the correct answer, and have no certainty. This is why I would prescribe "do nothing". The wisest counsel has usually been, "don't just do something, stand there." The fallacy of the government having a plan to respond to an economic crisis is that it knows what to do, or that it can figure out what to do given enough time and a sufficient number of intelligent stewards or brains-trusters. This is the well-intentioned but false idea behind industrial planning, which was fortunately struck down as unconstitutional in the US. Unfortunately the stench of the corpse still pervades Washington. It is also a fallacy that what is needed is "competence" (a favorite center-left nostrum), and that when something bad happens, it is the result of "incompetence" or advisors who simply weren't smart or glib enough. History is replete with examples of the government "doing something" to prevent economic pain, and creating a much bigger mess as a result.<<