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Does Matt Yglesias really want this? Is he serious?

In November, there’s going to be an election. And in January, there’ll be a new President. And in the interim, progressive groups will probably come up with a lot of “ten ways to make everything awesome” proposals. And it’ll take 41 conservative senators to filibuster them all, and so they’ll all be filibustered. But if the government directly controls major financial institutions, that would give the new administration extraordinary leverage over the national economy. Suppose the new CEO of AIG decided he didn’t want to insure assets of companies whose executives make unseemly multiples of the national median income? There are all kinds of crazy things you could do. And of course not all of them would be good ideas. But some of them would! And the smart folks on our side need to be figuring out which ones they are. It seems doubtful to me that a progressive administration would ever be able to get away with this much nationalizing of everything, but what’s done is done and I think it creates a real opportunity for “socially conscious insurance underwriting” or whatever you care to call it.

I’m absolutely dumbfounded.

Having read David Leonhardt’s extensive piece on Obamanomics, I’m inclined to think that Obama would avoid such foolish market interventionism. Indeed, he explicitly says he’s opposed to it in the above-cited article:

“If you talk to Warren [Buffett], he’ll tell you his preference is not to meddle in the economy at all — let the market work, however way it’s going to work, and then just tax the heck out of people at the end and just redistribute it,” Obama said. “That way you’re not impeding efficiency, and you’re achieving equity on the back end.”

I always knew that people of terribly unsound economic judgment were bound to be part of the Obama bandwagon. I guess I never assumed Matt Yglesias was among them.

UPDATE: I should clarify, perhaps, that I’m not terribly thrilled with Obama’s gambit. It’s completely acceptable in contrast to Matt’s formulation, however.