Atlas Shrugged: The Mocking

Wednesday, December 23, 2009

"Scoop" McArdle

Megan McArdle compares the CBO to ratings agencies like Moody's to prove that because bankers are crooked, the government is wrong about the cost of health care insurance reform. It's not worth going into, but her journalistic instincts are worth a mention.

It was totally legitimate for securities issuers to go to Moody's and say, "What kind of rating does this tranche get?" But at some point, the relationship got too close. Many allege that this is because of conflicts of interest, or financial malfeasance; I withhold judgment on these accusations. Whatever the cause, it has become clear that if raters and the rated work too closely together, the ratings begin to bear less and less resemblance to actual reality.

She does not find out the facts and draw a conclusion, she "withhold[s] judgement," a high-sounding way of avoiding research and unfortunate conclusions. If you don't know the facts you won't have to ever change your mind or feel uncomfortable about your decisions. "Whatever the cause"--what a convenient phrase. "New Orleans drowned--whatever the cause, it was a bad thing." "Wall Street gutted the financial system--whatever the cause, we must give them more money." "I drank underage, got a suspended license, couldn't register my car, couldn't repair my car, and therefore couldn't drive my new car---whatever the cause, Pennsylvania sure is stupid."


Malaclypse said...

Boy I'm glad that glibertarians believe in personal responsibility. In addition to her indignation at paying a penalty for breaking the laws in PA, I particularly liked "6. Car accidentally driven through red light in Logan Circle." which leads to further unfair penalizing of Megan for, well, breaking traffic laws and endangering people.

You can't make stuff like that up. The whole point of the post seems to be that laws are for little people.

Dr.BDH said...

I think I understand Megan and her tribe better, having read through these tales and the appended comments:

1. Nothing is ever really Megan's fault. (E.g., cars go through that red light all the time!)
2. All government is exactly like the DMV in Pennsylvania.
3. Even when the DMV outsources duties to a private company (e.g., California to Ohio private company) any problems are because of #2.
4. Universal health care will be just like the DMV because of #2.
5. Fast food chains deliver food fast, unlike the DMV or universal health care.

Substance McGravitas said...

If a security was rated AAA, well then, it must be an excellent security. People confused the rating with an actual prediction of the future.

What interest could Moody's $p$o$s$s$i$b$l$y$ $h$a$v$e$ $h$a$d$ in rating securities so highly?

The torrents of bonus money flowing through the CBO makes me distrust them!