Today's Reuters headline:
Paulson voices confidence in U.S. fundamentals
Today's AP headline:
Treasury chief resists Democratic push to add more help for households to $700B bailout.
The resemblance is striking:
Hoover ... refused to acknowledge reality and peddled unfounded optimism while rejecting relief programs for ordinary Americans.... Meanwhile, he pushed big-business bailouts in the hopes of finding a trickle-down solution to a crisis caused in the first place by trickle-down economics.
Today's AP story proceeds to reveal the principal difference between Democrats and Republicans:
Democrats ... insisted that the measure needed to provide help for homeowners threatened with losing their homes
The [Bush] administration proposal ... would dole out huge sums of money to financial firms.
This basic difference in philosophy was cemented nearly eighty years ago, after the Republican party of the 1920s led the nation down the same disastrous path the modern Republican party has revisited:
Coolidge and his Treasury Secretary, corporate titan Andrew Mellon ... introduced the country to "trickle down" economics, also known as "supply side" economics. Taxes for corporations and wealthy Americans were slashed, while government regulation was all but abandoned....
Hoover kept Mellon on at Treasury ....
Hoover’s lasting legacy is not that he made the mess, but that he failed to change course, even after the edifice began to crumble.
It wasn’t long before the notion of Coolidge-Hoover "prosperity" was a national joke. Americans wanted someone to tell them where they really stood, and they found him in Franklin Roosevelt.
Passages about Coolidge/Mellon/Hoover era from the introduction of my forthcoming book, Yeah, Right: "This Economy Is Strong" and Other Tall Tales. (Now available for preorder on Amazon).