Dartblog

We have reached a point in Hanover where Victorian gentility is the norm — and candor is shocking. Therefore it is nice to be joined in seeking to tell the unvarnished truth by faculty luminary Danny Blanchflower, a household name in Great Britain, about whom we have posted here and here.

Blanchflower’s column in the D today opines that the economy is not out of trouble yet: things could get much worse before they get better again, and we could see the up and down swings that occurred repeatedly in the Depression years for a decade after the Crash of ‘29.

But Blanchflower reserves special scorn for departed President Jim Wright’s wanton spending:

Many global policymakers and financial regulators have called for macro-prudential instruments as a way of ensuring that banks are cushioned against economic shocks. These instruments would ensure that banks apply a modicum of sense in their appraisal of risk, by putting money aside in the good times to prepare for the bad. This softens the blow on the downside. The previous administration under former College President James Wright did not do this. It failed to set priorities and to choose, because it felt flush with money and behaved as if the good times would roll forever and a day. And we are all going to have to pay the price for that incompetence. Eventually, budget constraints will bind, and they now have. We must not repeat their [sic] mistakes.

Good stuff. In my post yesterday, I laid the blame for the College’s financial crisis not only on the Wright Administration, but also at the door of the Trustees. Where were they as the College spent money with abandon over the last decade? It is not as if they were not warned years ago…