My Home About Me

Here's the generous choice that the incoming Democratic congressional majority is offering the business community: walk into the gas chamber yourself, or we'll shove you in. Representative Barney Frank (D-MA), likely to chair the House Financial Services Committee, calls it a "grand bargain." From the Boston Globe:

"I'm a capitalist, and that means I'm for inequality," Frank told Boston business leaders on the morning after Election Day, in a speech about his grand bargain.

But there's always a but:

"But you reach a point where you get more inequality than is healthy, and I believe we're at that point..."

So here's the "bargain" -- business "voluntarily" raises wages and embraces unionization, and the Dems won't clobber corporations with regulations and trade barriers.

"What we want to do is to look at public policies that'll get some bigger share of the increased wealth into wages, and in return you'll see Democrats as internationalists. . .. I really urge the business community to join us."

My DC lawyer/lobbyist friend writes,

So, business is supposed to agree to support a significant increase in its cost of doing business (increased benefits and wages) in exchange for a promise by Democrats that they will support free-trade and a reduction in regulation? I'm sure Barney's colleagues will jump on this grand idea....until it's dead.

Not withstanding his stated intent, this will turn into an excuse for Barney and the Democrats to pursue their economic agenda without constraint -- to burden or block free-trade issues, to increase regulation and to use politics to jack up labor costs -- justified somehow "because" business wouldn't deal. The political version of "the devil made me do it."

Gridlock might turn out to be inflation's best friend.

Amateur Investors   assets   bailout   bottom   capitulation   climactic   credit crunch   Currency ETFs   day trading   Deron Wagner   DJIA chart   Dow 1929 Crash   economic data   Emini's Nas 100   emini's S&P 500   emini's S&P 500e   ETFs (exchange trade funds)   ETFs (exchange traded funds)   inflation   International ETFs