Obama sacks Geithner and Summers, calls for change
In a dramatic speech on the edge of the G-20 summit on this first day of April, Fool was the watch word. Barack Obama announced that he was changing course and, in an extraordinary development, has given the sack to two of his closest economic advisers as proof of this change.
“Look, I told the American people when I ran for office last year that we were going to lead responsibly. We have not done so. For this, I am sorry. I stand before you this brisk day of April, fool enough to think you might allow us to start anew, to take this country on a new path – not one filled with recrimination and I told you so’s. But, rather a future of shared responsibility and effort to forge a sustainable recovery for ourselves and the generations of Americans to come.
As a result, I have asked for and received the resignation of two of my most trusted advisers, Lawrence Summers and Timothy Geithner. While I still have immense respect for them, confidence in their ability, and admiration for their dedication to the American people during this time of crisis, I have come to recognize the need for change. America wants change and I intend to deliver change you can believe in. In their place, I have selected Ron Paul as my Treasury Secretary and Joseph Stiglitz as chief economic adviser. My hope is with this symbolic gesture, the American people will realize we are serious about the process of governing responsibly.
There must be no return to the past of easy money and the good old days of unaffordable housing and huge, crushing debt loads. We can no longer stand for the laissez-faire self-regulation days of yore. This is the kind of Ersatz Capitalism that we can do without. In my view, self regulation is to regulation what self-importance is to importance. What we need now is a proper way to deflate this terrible bubble without innocent Americans getting hurt in the process.”
President Obama has called for six immediate steps:
- International co-ordination of financial services regulations globally.
- An end to fiat money and the beginning of a new monetary regime centered around the ideas of of professor Paul Davidson.
- The resignation of all the major big bank heads.
- A scrapping of the PPPIP plan he recently announced to be replaced by a bank pre-privatization model overseen by Paul Volcker.
- A commission on moving to a re-balanced global growth model to be headed by Stephen Roach.
- An immediate plan to regulate the over-the-counter derivatives market headed by Brooksley Born.
At the G-20 summit, leaders welcomed Mr. Obama’s surprising announcement. Nicolas Sarkozy of France suggested that he had influenced Mr. Obama. “Barack and I love each other. I looked the man in the eye and was able to get a sense of his soul. I knew I could help him see the light.”
Bank Officials were less positive about this news. Ken Lewis, CEO of Bank of America said, “this is nonsense. First, the Bush Administration forces us to buy Countrywide and Merrill and we do it and now they want me to step down. Fat chance.”
Jimmy Cayne, former Bear Stearns head was one of the few bank professionals to say positive things. “Hey, Ken, Jamie… welcome to the club.”
Mr. Obama also suggested that he was taking advice from a wider swathe of professional economists including Willem Buiter of the LSE, Paul Krugman of Princeton, Bill Black of University of Missouri-KC, James Galbraith of UT-Austin and Tom Ferguson of UMass-Boston.
More details to follow.
Oh, and by the way, April Fools!