New York Times (April 11)
The Financial Crisis Inquiry Commission is holding public hearings where leaders of failed financial companies are saying, “I’m sorry.” The New York Times neither accepts these apologies nor believes claims that, like others, the financial executives simply were unable to anticipate the crisis. “The crisis was the result of irresponsibility and misjudgments by many people.” The newspaper is convinced the apologizing executives epitomize “the financial recklessness that ruined the economy.”
he Economist (April 8)
Japan is “sleepwalking towards disaster.” According to the Economist, Japan has comfortably ignored major problems for two decades, but this situation cannot continue. With the world’s largest public debt-to-GDP ratio of 190%, Japan will face major hurdles. Already, the cost of borrowing (44 trillion yen) exceeds tax revenues (37 trillion yen). By 2015, Japanese investors may not be able to buy up all of the bonds the Japanese government needs to issue. Overseas investors will demand much higher returns. This increased risk premium could be paralyzing. Only bold action now can avoid a very dangerous situation.
The Times (April 6)
The current Parliament, in place for 5 years, is now the third longest. The Times sighs relief that an election has finally been called. For much of the past year Parliament “has been finished, without having stopped.” The Times laments the results: Britain is less prosperous, confident, free and cohesive than it should be. Still, The Times looks to “Britain’s future with confidence.”
New York Times (April 3)
Earnings of the 25 highest paid hedge fund managers soared to $25.3 billion in 2009. This record payday contrasts with the average American worker, whose most recent pay dropped to $18.90 per hour in March. What bothers the New York Times is that some money managers are taxed at just 15 percent for earnings treated as long-term capital gains. The newspaper argues that fund managers, like everyday workers, should be taxed at ordinary income rates which extend to 35%.
Washington Post (April 1)
The Troubled Assets Relief Program (TARP) remains unpopular. Few Americans like the idea of rescuing the financial industry with taxpayer money. Still, the $700 billion TARP did prevent economic collapse. And now TARP is returning money to taxpayers. TARP is selling assets picked up for cheap during the crisis. For example, the Treasury Department plans to sell its 27% Citigroup stake at a profit of $8 billion. When everything is finished, about $600 billion is likely to be returned to taxpayers. The Washington Post calls TARP “a bargain.” With a final cost now estimated at $100 billion, TARP was able to “stem the panic-induced collapse of a banking system.”
