IRRATIONAL EXUBERANCE ACCOMPLISHED
Frank Rich today:
It's remarkable how often apologists for Wall Street's self-inflicted calamity mirror the apologists for Washington's self-inflicted calamity of Iraq. In the case of that catastrophic war, its perpetrators and enablers almost always give the same alibi: "Everyone" was misled by the same "bad intelligence" about Saddam Hussein's W.M.D. Hence, no one is to blame and no one could have prevented the rush to war.
That, of course, is no more true than [Alan] Greenspan's claim that "everyone" was ignorant of the potentially catastrophic dangers in the securitization of subprime mortgages. There were dissenters in the press, intelligence agencies and Congress who did doubt the W.M.D. evidence and asked tough questions akin to those asked by financial apostates like Michael Burry during the housing bubble. But these dissenting voices were either ignored, ridiculed or censored in the feverish rally to war....
So how else are these two situations analogous?
I've read several times that even subprime-mortgage skeptics on Wall Street felt they couldn't take a pass on invests based on them, and couldn't cash out early -- piles of money were being made, and if you were running a fund, you couldn't not participate in the mania for as long as it lasted.
Was the decision to go to war in Iraq somewhat like that? Did the Bushies -- an awful lot of them former CEOs -- look at the uptick in Bush's polls after 9/11 and the Afghan war and see a bubble? A bubble they simply had to take advantage of for as long as it was inflated? Was that the point (or at least one of the points) of the Iraq invasion simply to sustain that Bush/GOP poll bubble? As businessmen, could they just not bear to take advantage of it, and keep taking advantage of it, until it burst and it was too late for them to cash out?