The Plan That WAS ‘Absolutely Essential’

Dean Baker (Beat the Press, 11/12/08) wants to know “Where’s the Ridicule?” since “Treasury Secretary Henry Paulson announced today that he had abandoned… his plan to buy bad assets from banks and other financial institutions.”

Now that Mr. Paulson has himself decided that the Troubled Asset Relief Program is not a good idea (for which he deserves credit), why isn’t the media doing some examination of this recent history? Obviously his claims about the necessity of the TARP were not accurate, and those who repeated them were mistaken.

There were many members of Congress who stuck their necks out to oppose the TARP at the cost of derision from the media and political elites. Even Secretary Paulson now acknowledges that the rescue plan that he presented to Congress was the wrong course of action. The media has an obligation to present these facts clearly to the public.

Baker reminds us that “opponents of the TARP were widely derided in the media as ignorant economic know nothings” at the time when “Paulson said [the plan] was absolutely essential for the economy’s survival.”

But again, financial journalists have largely been wrong on this from the start; see the new issue of FAIR’s magazine Extra!: “Busted Bubble: The Press Fell Down on the Job on Housing Prices” (11-12/08) By Veronica Cassidy