THE "LITTLE HELPERS" OF THE FREE MARKET FAIRY

That's the wingnuts. Since 2004, they have been bleating about how great the U.S. economy is despite all the contrary evidence. And they aren't shy about blaming others for the problems caused by voodoo economics, as Phil Gramm just reminded us. As I noted below, Gramm is far from alone in his view. A new example is Jonah Goldberg, who thinks Gramm's comments were "substantially correct."

This attitude of blaming others goes back to Saint Reagan, who was angry with the banks for not lowering interest rates¹:

The day before, President Reagan also had told reporters that it is up to banks, not the Federal Reserve, to bring rates down.

Reagan said he saw "no reason why the banks can't bring those interest rates down another notch or two. It is up to the banks. And I do not know of what the Fed could do to force that. They cannot give orders."

Reagan was still complaining over a year later²:

President Reagan said Tuesday interest rates are ''outrageously high'' and inflation cannot be used by Wall Street as the excuse for them. ... Reagan has complained that Wall Street banks that set the prime rate are keeping it artificially high out of fear of future inflation.

But, he said, ''With signs of future price trends pointing to low rates of inflation as far as we can see, I can't help believing that there's no excuse for interest rates being where they are.''

''The interest rates today are outrageously high and they cannot have any excuse in inflation for their being at that level,'' Reagan said.

¹The Washington Post
February 25, 1983, Friday, Final Edition
Volcker Still Resists Rate Appeals
BYLINE: By John M. Berry, Washington Post Staff Writer
SECTION: Business & Finance; C9
LENGTH: 825 words

²United Press International
July 24, 1984, Tuesday, AM cycle
Reagan, Wall Street disagree on interest rates
SECTION: Washington News
LENGTH: 465 words
DATELINE: WASHINGTON