Martin Feldstein Suggests Spain Should Force Citizens and Companies to Buy Government Debt

My Take:  Martin Feldstein’s article in the FT from a couple of days ago is so frightening I feel compelled to turn everyone’s attention to it if they have not read it yet.  The focus of the piece is Spain and he spends much of it talking about how “confidence” is the key (one of the 10 Commandments of the Keynesian religion).  While that is to be expected, he then goes on to state that the Spanish government should consider forcing its citizens and corporations to buy sovereign debt.  Here are the key paragraphs:

An alternative emergency approach would be to mandate, on a temporary basis, bond purchases by Spanish households and businesses. Here is how such a plan might work.

The Spanish government could use the income tax system to levy a temporary “lending surcharge” on individual incomes. In exchange for those surcharge payments, the households would receive an interest-bearing government bond with a maturity of five to 10 years. A similar surcharge could be levied on businesses based on corporate profits or the businesses’ value added.

If that doesn’t scare you I don’t know what will.  So let me get this straight.  Banks and governments took on massive debt and leverage.  Then they blow up the entire global financial system. Then the Central Banks bail them both out.  Washington D.C. is now the wealthiest area in America yet they produce nothing and take everything.  Now what is this genius’ solution to it all?  Force the citizenry and companies “based on corporate profits” to fund the government, which of course is just another backdoor bankster bailout.  This is plain and simple financial serfdom, brought to you by a Professor of Economics at Harvard (supposedly one of the best educations in America) and an adviser to Reagan (sounds more like he advised Stalin).  Just remember your money is not your money according to these guys…

The full article is here although you may not be able to read it without a subscription.  It’s titled “Time for householders to buy bonds and save Spain” from April 30, 2012 if you want to try to find it another way.


2 thoughts on “Martin Feldstein Suggests Spain Should Force Citizens and Companies to Buy Government Debt

  1. All the while the Australian population live in our own little bubble,thinking our 1/2% rate cut is a positive factor!

  2. This Marty?…why does anyone interview this pos?

    For those who haven’t seen the movie, here is a transcript of the segments with Feldstein. Arrogance understates his contribution to the movie.

    Ferguson: Over the last decade, the financial services industry has made about 5 billion dollars’ worth of political contributions in the United States. Um; that’s kind of a lot of money.That doesn’t bother you?

    Feldstein: No.

    Narrator: Martin Feldstein is a professor at Harvard, and one of the world’s most prominent economists. As President Reagan’s chief economic advisor, he was a major architect of deregulation. And from 1988 until 2009, he was on the board of directors of both AIG and AIG Financial Products, which paid him millions of dollars.

    Ferguson: You have any regrets about having been on AIG’s board?

    Feldstein: I have no comments. No, I have no regrets about being on AIG’s board.

    Ferguson: None.

    Feldstein: That I can s-, absolutely none. Absolutely none.

    Ferguson: Okay. Um – you have any regrets about, uh, AIG’s decisions?

    Feldstein: I cannot say anything more about AIG

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