In a post yesterday, I mentioned Nixon's imposition of wage and price controls in 1971, which totally didn't work, and in fact, led to the raging and debilitating inflation of the latter half of the 70's.
In his Washington Post column today, Robert Samuelson also brings up Nixon's wage and price controls as an even bigger intervention in the economy than the proposed Paulson bailout plan. That's an interesting point.
His other main point is one that we increasingly hear about this Paulson plan: it is being put together too quickly and could backfire just as easily as Nixon's wage and price controls.
"The rescue is being constructed so hastily that it may include all manner of flawed provisions: too much power for the Treasury secretary; authority for bankruptcy judges to modify mortgages. Congress faces a wrenching dilemma, imposed on it by financial markets and Paulson. If it dawdles, it may invite the panic that Paulson has brazenly predicted. But if it acts quickly, it may create a monster whose full implications emerge only with time."
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