Wednesday, May 26, 2010

Gingrich attacks the bailouts to play to the anti-government Tea Party crowd, but later justifies them to defend Bush.


Newt Gingrich recently sat down with for an interview promoting his new book To Save America in which he argues that America is being taken over by a “secular socialist machine.” Fivethirtyeight’s Tom Schaller asked about the 2008 bank bailouts, noting that some have called it a form of “corporate socialism.” In response, Gingrich attacked the Bush bailout and then-Treasury Secretary Henry Paulson for implementing it:

GINGRICH: I feel very strongly about that. I said at that time that I thought Henry Paulson should not have been Treasury Secretary. I thought it was totally wrong for the former chairman of Goldman Sachs to be funneling billions of dollars from the taxpayers to Goldman Sachs. And I have said over and over, you can’t have capitalism on the way up and socialism on the way down because you get socialism both ways.

Later in the interview, Schaller asked Gingrich what he thinks of President Bush, “under whom the first $3 trillion budget and first $1 trillion deficit was passed.” This time, Gingrich had some very different things to say about the bailouts. The former Speaker defended Bush’s tenure, adding that he had no choice but to push taxpayer money on the nation’s largest banks:

GINGRICH: I think that he was very sincere in his desire to protect America. I think he was very sincere in his basic conservative social values. I think he began his Administration with a real commitment on lower taxes and more economic growth, precisely in the Reagan model. And I think that late in his Administration that he was frankly worn down by the bureaucracies in Washington. [...]

And then I think when the crisis hit in the fall of 2008 everybody panicked. Candidly, there was a period there when you had the Federal Reserve chairman and the Secretary of the Treasury saying, “If we don’t do X, Y and Z, the entire world economy is going to collapse.” That’s pretty good grounds for stopping and trying to do something. It’s easy for people to say, “Well, I’d rather have risked a world depression.” But most of the people I talked to in the private sector at the time were really worried about the system freezing up totally........................................

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