OPINION:
It is easy to listen to Federal Reserve Chairman Ben S. Bernanke recount the mistakes of the central bank during the Great Depression and conclude that by knowing so well what happened in the past, Mr. Bernanke will not let such economic mistakes be made again. Unfortunately, this is pure, unadulterated conceit on the part of Mr. Bernanke.
It is not difficult to imagine the head of the central bank in the 1920s and ’30s describing the booms and busts of the 19th century and believing he would not repeat those mistakes. In that regard, Mr. Bernanke may be just as informed and ordinary as his predecessors, which is to say he could be wrong about repeating past errors.
The U.S. economy, not to mention the world economy, is vastly different now than it was in the 1930s, just as the economy of the 1920s and ’30s was vastly different from the economy during the 19th century. The entitlement programs that have been maturing for more than half a century are now unstable financial disasters not only in the United States, but are actually imploding in Europe. The central bank has been quite culpable in letting the politicians off the reform hook simply by monetizing the debt that provides the irresponsible spending that they authorize.
Have you ever considered what happens to a submarine that experiences a flooding casualty when cruising at deep depth? The skipper puts the pedal to the metal, points the bow up and heads to the surface as fast as possible. The ballast tanks are blown on the way up, and most submarines make it to the surface in this situation. However, the craft is very unstable and if you do not manage the flooding, the submarine rapidly upends and accelerates to the bottom.
This situation is a lot like that of Greece and the other 250 countries that have gone bankrupt in the past 200 years. Mr. Bernanke and the United States may be less able to swerve around economic disaster than he had hoped.
SAMUEL BURKEEN
Reston
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