Joseph Stiglitz: Wall St Has Done a Very Good Job Of Fear Mongering

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Ben Cohen
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By Ben Cohen

Joseph Stiglitz isn't so sure the country would collapse if the banks went down:

Wall Street has done a very good job of fear mongering. They say, "If you don't save us, the whole system will go down." But, you know, when these banks that I talked about before, when they go down, there's not even a ripple. The fact is, you change ownership. It happens on airlines all the time. An airline goes bankrupt, a new ownership, financial reorganization—not a big deal. What they've succeeded in doing is instilling a sense of fear, so that it's a kind of paralysis that hangs over what we're doing. And you could understand a politician. He's been told if you do one thing, the whole system—the sky is falling, it's going to fall. That induces political leaders to try to do the smallest incremental step, and that's what got Japan in trouble.