Wednesday, March 25, 2009

Anyone have an answer?

John Mearsheimer asks how we were so badly let down by the "experts" in both finance and foreign policy.

This is a great question, and one to which nobody has an answer. I (at the ripe old age of 18 or so) opposed the Iraq war from the start. But I opposed it on the grounds that it was an invasion of a sovereign country that did not pose a threat to the United States. I did not think far enough ahead to make the connection with Vietnam, the French occupation of Algeria, or the Soviet invasion of Afghanistan. Then again, I was in high school. So why didn't those great foreign policy thinkers make the connection? That is something I certainly can't answer. I'm sure it had something to do with hubris, but not everyone could have been drinking the Kool-Aid, right?

I think the financial crisis has a simpler explanation. Greed. Most of the smart people in finance were making money hand over fist. Nobody wants to admit that such a profitable thing might be disastrous in the long term. Not to mention, it's different this time. That still doesn't explain why there weren't any people at all willing to snap out of it, but I think it is a large part of it.

If anyone has a better explanation (or any explanation at all), I would love to hear it.

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