Friday, February 05, 2010

Still beating the dead horse, Bo?

Rather than being a voice outside the “Washington echo chambers,” TEAB has become synonymous with a pseudo Treasury doing more harm than good to the Obama administration. It is high time Barack Obama – ‘Bo’ for short – scraps the board, says B&E’s gyanendra kashyap.

One word which aptly describes November 4, 2008, is ‘historic’, and rightly so. It was the audacity of hope that saw a Black family taking up the ‘first’ mantle inside the White House on that day. Interestingly, since then, the rhetoric has been ‘change’ and ‘hope’. Three days after the election, President-elect Barack Obama announced a 17 member Transition Economic Advisory Board (TEAB). Till now, the advisory board which was constituted to offer the President-elect independent voice about how to ensure a strong economic recovery from outside of the ‘Washington echo chambers’, has been functioning more as a pseudo Treasury.

Rather than being known as advisors to Obama on how to navigate through the worst financial crisis in modern history, many of the TEAB economic crew can be dubbed as the Bailout Bunch – not because they worked out a bailout plan, but because, they themselves required a bailout! Consider the DNA of the economic crew and you find that almost half of the people on Obama’s economic advisory board (including Lawrence Summers, Robert Rubin, Anne Mulcahy, Richard Parsons, William Daley, Laura Tyson and Penny Pritzker) have held fiduciary positions at companies which either fried their financial statements or helped send the world into an economic tailspin. The leading figures in the transition team, Lawrence Summers and Robert Rubin have both been enthusiasts of deregulation – a major factor in the financial crisis.

“The state of the economy calls for action, bold and swift, and we will act – not only to create new jobs, but to lay foundation for growth,” was what Obama said to the TEAB. A majority of the members of TEAB had been very instrumental in the economics of Obama’s presidential campaign. Given that, it is surprising that even after a year, Obama’s massive campaign apparatus has been largely still doing nothing, than some members demanding another wave of bailouts – for example, lobbyists within the TEAB, such as Laura Tyson, argue that the $787 billion stimulus package was a bit too small and perhaps what is required is a second stimulus package which will focus on infrastructure projects.

That’s pretty bold and near kooky, considering the fact that as of this month, only $173 billion or 22% of the Federal Reserve’s $1.3 trillion “adrenaline shot” has been spent. This, to the view of many, is too slow, too wasteful, and too unfocused as compared to Obama’s initial intention of bold, swift and employment generation. Chairman Waxman of the Energy and Commerce Democratic Press Office, and Daniel Virkstis, Member, US government’s Committee on Finance, while separately inviting B&E’s queries on the efficacy of the economic advisory board, had not responded till the time of this article going to press.

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Source :
IIPM Editorial, 2009

An IIPM and Professor Arindam Chaudhuri (Renowned Management Guru and Economist) Initiative

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