Tuesday, January 26, 2010

The Fed and the Treasury: Heads Should Roll

Krugman's "one cheer for Bernanke" notwithstanding, I think some heads have to roll here. Any favorites to replace him?

I've heard Blinder, Yellen, and Volcker mentioned.

And at Treasury, am I wrong to dream of a team featuring Brooksley Born, formerly of the CFTC, Elizabeth Warren of the TARP oversight panel, and maybe Sheila Bair of FDIC? Make Born the Treasury Secretary, Bair the Comptroller of the Currency, and Warren the head of what should be a new Financial Product Safety Commission.


Karlissimo del Banco said...

Great picks, though Sheila Bair was responsible for my friend Gary getting laid off from IndyMac in Pasadena after the Feds took over...

I have no evidence to really back this up, but I think an academic economist without much professional ties to the banking industry might be a good choice...though as you pointed out, that is Bernanke's background. So maybe that doesn't make any difference.

C - Log said...

How about at the Fed, Signor del Banco? Any favorites?

Karlissimo del Banco said...

Oh boy....I dunno....a good labor economist, someone like Larry Mishel or Jared Bernstein at EPI? I think that the primary role of the Fed is to keep unemployment as low as possible, so I think it might be a good idea to try out someone from that academic background. I might even be convinced to trust Krugman to do a decent job.

C - Log said...

I started to write a response but it got so long I turned it into a new post... "Wanted at the Fed: An Inflation Dove."

Chuck C said...

I say Stiglitz for Treasury. His new book gets it right.

C - Log said...

Stiglitz, right. I forgot about him. He'd be great, and he has the policy-making credentials from his time at the World Bank. The Nobel doesn't hurt either.

Karlissimo del Banco said...

Stiglitz! Absolutely. Let's give him some Jo-mentum!

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