So I’m chilling and listening to Bob Marley, you know – and he sings:

The stone that the builder refused / will always be the head corner stone

Beautiful, isn’t it? Even the ugly duckling among stones doesn’t need to fear – eventually, after always having passed it by and using better, more beautiful stones, the builder will have almost finished the construction and darn it – he will need that rejected, subpar stone for that prize spot at the very top after all.

But that doesn’t make any sense! That is, it would make sense if there was a definite, finite supply of stones available. If you have limited resources, the only way to ensure everyone gets a shot is by judiciously sharing them. That’s communism. But this is capitalism! Doesn’t he understand? It’s not about sharing the pie, it’s about expanding the pie!

In a market economy, if the builder runs out of stones, he won’t use the subpar stone he refused in the first place, he’ll just get more stones. Import them if need be. Cheap stones from poorer countries perhaps. And, well – if that stone that didn’t make the cut the first time round still wants to have a place in the building, he’ll just have to shape up and improve himself! Be a better, bolder and more productive stone, and face the competition!

Bob Marley, meet Ayn Rand.

Noting that Kevin Hassett, of Dow 36000 fame, is now director of economic policy studies at the conservative American Enterprise Institute and confidently proclaiming his neo-Hooverite recipes for tackling the financial crisis, Neil Sinhababu of Donkeylicious sighs, “I guess it’s kind of like the Iraq War, where you can give really bad advice and still hold onto an awesome think tank job.”

Which leaves us, he adds, only with the power of satire. Crude satire, to fit crude stupidity. Here’s Neil’s reworking of Hassett’s now-notorious book – and here’s mine:

"Soup line", part of Franklin D. Roosevelt Memorial (Image used under CC license from Flickr user Gabriel Millos)

If the erupting economic crisis hasn’t already led to soup lines and double digit unemployment, Kevin Drum argued yesterday, it is only thanks to the safeguards that were put in place since the crash of 1929.

Without Social Security, Medicare, unemployment insurance and deposit insurance; without the Treasury pumping capital into the banking system and the abandonment of the gold standard, we would already have reached that point.

So “thanks, FDR,” Drum writes*, “thanks, modern mixed economy” – and thank you LBJ as well, Eisenhower too, and all their counterparts here in Europe for that matter. Add those to your reasons to be cheerful. If it had been up to the Goldwater-Reagan ideology, this crisis would already have incurred much more suffering.

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* Though it’s an interesting afterthought that Roosevelt, “concerned about the moral hazard” involved, actually opposed creating the deposit insurance system, along with banking industry groups. Seems like the idea actually came from his left: he thought it went too far and even threatened to veto the legislation.