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Tom Friedman: Green the Bailout
From: David Farber <dave () farber net>
Date: Mon, 29 Sep 2008 08:16:07 -0400
From the New York Times -- <http://www.nytimes.com/2008/09/28/opinion/28friedman.html?partner=rssuserland&emc=rss&pagewanted=all
Green the Bailout
By THOMAS L. FRIEDMAN
Many things make me weep about the current economic crisis, but none
more than this brief economic history: In the 19th century, America
had a railroad boom, bubble and bust. Some people made money; many
lost money. But even when that bubble burst, it left America with an
infrastructure of railroads that made transcontinental travel and
shipping dramatically easier and cheaper.
The late 20th century saw an Internet boom, bubble and bust. Some
people made money; many people lost money, but that dot-com bubble
left us with an Internet highway system that helped Microsoft, I.B.M.
and Google to spearhead the I.T. revolution.
The early 21st century saw a boom, bubble and now a bust around
financial services. But I fear all it will leave behind are a bunch of
empty Florida condos that never should have been built, used private
jets that the wealthy can no longer afford and dead derivative
contracts that no one can understand.
Worse, we borrowed the money for this bubble from China, and now we
have to pay it back — with interest and without any lasting benefit.
Yes, this bailout is necessary. This is a credit crisis, and credit
crises involve a breakdown in confidence that leads to no one lending
to anyone. You don't fool around with a credit crisis. You have to
overwhelm it with capital. Unfortunately, some people who don't
deserve it will be rescued. But, more importantly, those who had
nothing to do with it will be spared devastation. You have to save the
But that is not the point of this column. The point is, we don't just
need a bailout. We need a buildup. We need to get back to making
stuff, based on real engineering not just financial engineering. We
need to get back to a world where people are able to realize the
American Dream — a house with a yard — because they have built
something with their hands, not because they got a "liar loan" from an
underregulated bank with no money down and nothing to pay for two
years. The American Dream is an aspiration, not an entitlement.
When I need reminding of the real foundations of the American Dream, I
talk to my Indian-American immigrant friends who have come here to
start new companies — friends like K.R. Sridhar, the founder of Bloom
Energy. He e-mailed me a pep talk in the midst of this financial
crisis — a note about the difference between surviving and thriving.
"Infants and the elderly who are disabled obsess about survival," said
Sridhar. "As a nation, if we just focus on survival, the demise of our
leadership is imminent. We are thrivers. Thrivers are constantly
looking for new opportunities to seize and lead and be No. 1." That is
what America is about.
But we have lost focus on that. Our economy is like a car, added
Sridhar, and the financial institutions are the transmission system
that keeps the wheels turning and the car moving forward. Real
production of goods that create absolute value and jobs, though, are
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- Tom Friedman: Green the Bailout David Farber (Sep 29)