The perception that the [o]bama administration has been subservient to Wall Street is probably the single greatest political vulnerability the Democrats face. The President spent the last couple of days saying some really mean things about bankers (he said he didn't get elected to help the "fat cats"
), and he has now summoned them for a meeting at the White House, where he's going to explain their moral duty to help the public after the public (i.e.
, the Government) did so much to help them.
I guess sticking it to the fat cats goes something like this:
Step One: hold press conference to proclaim that you are going to stick it to the fat cats
Step Two: continue employing the following people
-Mark Patterson, Cheif of Staff for Treasury (previously V.P. of government relations at Goldman Sachs)
-Niel Kashkari, Head of Office of Financial Stability for Treasury (previously V.P. of Goldman Sachs)
-Gary Gensler, Head of CFTC (previously Partner and Managing Director at Goldman Sachs)
-Stephen Friedman, Chairman of National Economic Council, Chairman of Presidents' Foreign Intellgience Advisory Board (previously CEO of Goldman Sachs)
-Joshua Bolton, White House Cheif of Staff (previously Executive Director of Legal and Governmental Affairs at Goldman Sachs)
-Edward Forst, Special Consultant on Fannie and Freddie Bailout (previously Executive V.P. of Goldman Sachs)
-Reuben Jeffrey, Under-Secretary of State for Foreign Affairs, Interim Cheif Investment Officer for TARP (previously Managing Director and Partner for European Financial Institutions Group of Goldman Sachs)
-Steven Shafran, Sr. Advisor to Treasury Secretary (Partner at Goldman Sachs)
And that's just Goldman Sachs, and just this adminstration
In any case, to answer the initial question, debt aids in economic growth. There is nothing inherently wrong with debt, so long as that is debt from savings; i.e. a situation in which excess, unused capital is lent out for productive employment at rates of interest set by the free market. If, however, debt is accrued by expansion of the money supply and used to fuel consumption at artificially low interest rates, the result will be disaster.
Basically, debt in a sound currency regime is fine. Debt in a fiat currency regime is both inevitable and ultimately lethal.