Story by Kent Ava
The future of the United States economy and its relative fate for survival during a major financial slump caused in part by ineffective approaches and mishandled stimulus money was discussed on Oct.26th by Floyd Norris, chief financial correspondent for The New York Times at the Marriott Library Gould Auditorium.
Norris emphasized that a paradigm shift was necessary to get the economy moving again and governments moving away from Andrew Mellon’s philosophy of letting things work themselves out on its own.
Andrew Mellon, Secretary of the Treasury during the 1920s, in which his viewpoint of a intervening government during the stock market crash and tumbling economy was, “keep your hands off and let things work out by themselves,” an ill-fated approach that plagued the economy for years, according to Norris.
According to Mellon, the product of being poor was their [poor people’s]own fault and financial ruin was a direct result of their incompetency, only to be replaced by the superiority of the elite and wealthy.
“The real point here to me is that we used to take for granted that the government should try to improve the economy and there were things they could do,” Norris said.
Norris also referenced Herman Cain, former CEO of Godfather’s Pizza, who said about his approach to one’s wealth, “Don’t blame Wall street, don’t blame the big banks, if you don’t have a good job and you’re not rich, blame yourself,” reaffirming the attitude that it’s the fault of the poor for being poor.
Bryce Bagley, a mass communication major, said that the forum gave a relative perspective into today’s failing economic situation.
“It was somewhat refreshing to get a professional opinion of the relevance to the economy’s potential future and possible bounce back,” said Bagley.
He also said that it provided a unique view to the market that he soon will be working in and a better understanding on how to prepare for his future.
“This gives me a whole lot to consider when it comes down to the state of the economy and how it will affect me and my family,” said Bagley.
Norris said that he would like to see an attitude of pragmatism rather than ideology when it came to an economic stimulus to get the most growth.
“I’d like to see shorter-term stimulus. It needs to be carefully targeted to do good,” Norris said. “If we are going to have stimulus, it should have the most economic bang for their buck.”
Morgan Heath, a senior in mass communications, said that she agreed with Norris’ proposal for a short-term stimulus and its goal to maximize its worth.
“I can see how a short-term stimulus can be effective, because it focuses on economic demands now rather than later,” said Heath.
“It seems to be the analysis that ‘because stimulus doesn’t work, we shouldn’t try it,’ ” Norris said.
He compared the situation to a student who studies for a test, does poorly and then concludes that he or she should no longer study for tests.
Norris concluded with the idea of reestablishing hope in the government’s financial system and its job to allocate capital wisely.
“Its[stimulus]role is to help the real economy function and grow and not be supported by bailouts,” said Norris.
Norris’ lecture was part of the University of Utah’s 15th annual Rocco C. and Marion S. Siciliano Forum hosted by the Hinckley Institute of Politics.