The turmoil in financial markets is not good news, but one silver lining to the dark cloud is the rather amusing contest for the most inane reaction by a political figure. Australia's Prime Minister is proudly demonstrating his economic illiteracy by blaming "extreme capitalism" even though the financial services are heavily regulated and a wide range of policy mistakes created the housing bubble. Agence France Presse (how appropriate) reports:
The global economic crisis is a result of the "comprehensive failure of extreme capitalism," Australian Prime Minister Kevin Rudd said Wednesday as he took aim at bulging executive pay packets. The centre-left Labor Party leader named greed and fear as the "twin evils" at the root of the financial sector collapse, which began in the United States and swept the world. "What we have seen is the comprehensive failure of extreme capitalism -- extreme capitalism which now turns to government to prevent systemic failure," Rudd told the National Press Club in Canberra. ...Governments should act so that greed and lax regulation were never allowed to put the world in the same position again, he said, adding that Australia would press for this at a meeting of the G20 group of 20 rich and emerging nations next month. ...Rudd said his government would work with the Australian Prudential Regulatory Authority (APRA) to bring fat-cat pay packets under control. "This is not just a question of fairness and perceived fairness in the system, it goes actually to the kernel of the incentive structures around risk-taking," he said.