Showing Some Discipline

By DAVID BROOKS
NYT

It’s no fun being a leader in a financial crisis. You’ve got to be bold but reassuring, free-spending but disciplined. You must decisively crush the short-term problem without freaking everybody out and leaving a long-term mess.

To my mind, the stimulus packages on Capitol Hill fail to strike these balances. They are broad but sloppy, too slow to make a quick difference and too enduring to avoid fiscal damage.

But another part of the administration’s economic strategy is being unveiled today by Treasury Secretary Tim Geithner, and at first blush the news is much happier. Geithner’s plan is huge but also disciplined. It’s designed by someone aware of government’s limitations.

Geithner has been working the financial meltdown for a while. The basic lesson he has drawn is that the federal government has been too constrained. Occasionally, policy makers would step on the accelerator and bail out a bank, but then they’d step on the brake, worrying about moral hazard or inflation.

(More here.)