Bret Stephens: Hi, Gail. I guess we have to talk about Donald Trump’s potential indictment and arrest, right? But before we go there: You know how I told you that I’d vote for Ron DeSantis over Joe Biden?
Well, never mind.
Gail Collins: Bret! You’re gonna vote for our big-spending president? Student-loan forgiver? Tax-the-richer?
Bret: I’m still holding out faint hope that Nikki Haley or Tim Scott or my friend Vivek Ramaswamy or some other sound and sane Republican long shot somehow gets the nomination.
Gail: Happy to gear up for that fight.
Bret: But for DeSantis to call Russia’s invasion of Ukraine a “territorial dispute” in which the United States does not have a “vital interest” tells me that he’s totally unfit to be president. He’s pandering to the Tucker Carlson crowd.
Gail: The Terrible Tuckerites …
Bret: He is parroting Kremlin propaganda. He’s undermining NATO. He’s endangering America by emboldening other dictators with “territorial disputes,” starting with China’s Xi Jinping. He’s betraying the heroism and sacrifice of the Ukrainian people. He’s turning himself into a kind of Diet Pepsi to Trump’s Diet Coke. He’s showing he’s just another George Costanza Republican, whose idea of taking a foreign-policy stand is to “do the opposite” of whatever the Democrats do.
Gail: Wow, can’t believe I’ve found someone who thinks less of DeSantis than I do.
Bret: So, about Donald: to indict and arrest or not to indict and arrest? That’s the question. Where do you come down?
Gail: No real doubts on the guilt front, and I’m pretty confident we’ll eventually see an indictment. The question is — what then? I’m hoping for a procedure in which he has to appear in public to answer the charges but doesn’t get treated in any way that’ll cause any not-totally-crazy supporters to gather for a riot.
Bret: True, though why do I get the sense that Trump is practically jumping for joy? I mean, the first indictment of a former American president is going to be over what is typically a misdemeanor? I yield to nobody in my disgust with the guy, but so far, this sounds like prosecutorial abuse and political malpractice. Democrats will live to regret it.
But to go from the horrifying to the truly horrifying: How goes your banking crisis?
Gail: Bret, would definitely appreciate this not being “my” banking crisis.
Bret: Give the crisis about six months. Or six weeks. Or maybe six days. It’ll be all of ours. Suggest you buy inflation-proof assets, like a rare instrument or 50-year-old scotch.
Gail: Or some great old wine! Although in my house it’d never outlast the bank bust.
As to a response, I’m in Bidenesque territory — the government does what it has to do to stabilize the situation, including covering the deposits in delinquent institutions like Silicon Valley Bank. But the only people who get rescued are the depositors.
Bret: The big mistake of the administration was to bail out all the depositors, including a lot of very rich people who ought to have known better, instead of sticking to the F.D.I.C. limit of $250,000. Now the Feds have bailed out a bunch of rich, foolish and undeserving Silicon Valley dipsticks while creating an implicit, and systemically dangerous, guarantee for all depositors at all banks.
Gail: I don’t love the idea of helping out $250,000-plus depositors, even over the short term, but this is not a good moment to destabilize the whole economy.
Over the long term, however, those banks, their managers and big stockholders are going to have to be held accountable. Also Congress, which watered down regulations on midsize banks a few years back.
Bret: Hard to tell whether the real issue was inadequate regulation, a badly run bank or — my guess — far deeper problems in the economy. Turns out Silicon Valley Bank didn’t even have a full-time chief risk officer for much of last year.
Gail: You will notice I haven’t mentioned the Federal Reserve. Saving that for you …
Bret: The Fed now has two bad problems, both of them largely of its own making. The first is inflation, which remains stubbornly high and was brought on in part because interest rates were too low for way too long. The second is an economy, particularly the banking sector, that seems to be seriously ill prepared for an era of higher rates. A classic Scylla and Charybdis situation, through which Jay Powell is somehow supposed to steer us. My advice to Powell — other than to tie himself to the mast — is to continue to raise rates, even if it means recession, and call for fiscal relief in the form of tax breaks for businesses ….
Gail: Stopstopstop. Bret, Congress has to get a budget passed somehow, and the Republican plan is so nutty that even some Republicans don’t buy it. You’re suggesting that we cut taxes for businesses that are already making handsome profits.
Bret: Businesses may be looking forward to a steep recession and much steeper borrowing costs. It’s a recipe for collapsing revenues and mass layoffs for businesses large and small. Better for the government to lighten the load for employers, even if it means piling on additional federal debt. In fact, it could be a good way to solve the debt-ceiling question.
Gail: The people who are demanding this kind of bonanza for the rich are the same ones who are violently opposed to giving the deeply underfunded I.R.S. any new money. What could be worse than efficiently monitoring tax compliance?
Bret: We’re both in favor of giving the I.R.S. the funding it needs to answer taxpayer phone calls. But if the economy is about to fall off a cliff, I don’t think the answer is to make sure the taxman is at the bottom of it, picking the pockets of the dead and wounded. Gail, this topic is … getting me down. You wrote a column last week saying that Kamala Harris is definitely staying on Joe Biden’s ticket. That gets me down, too, but please explain further.
Gail: Well, we both agreed for quite a while that if Biden ran again, he should pick a different veep.
Bret: Like Gina Raimondo, the commerce secretary, or Michelle Lujan Grisham, the governor of New Mexico, or Danielle Allen, the brilliant Harvard political philosopher who has the added virtue of not being a politician.
Gail: Yes, but then I gave it a long, hard thought — trying to imagine how that would work out. Tossing Harris off the ticket would be hugely disrespectful. There’s nothing she’s done that deserves that kind of insult.
Bret: Did Nelson Rockefeller deserve it? Politics is politics.
Gail: There are lots of terrific women in high places — governors and senators — who’d be terrific as vice president. But we aren’t starting from scratch. Harris has made some errors in her current job, but she’s done some good things, too. Just don’t think this rises to the occasion of Throw Her Out.
Bret: To me, she’s Dan Quayle-level ridiculous — and George H.W. Bush would have been wise to toss Quayle from the ticket in 1992. You can bet that whoever the Republican nominee is next year will hammer away at Biden’s age and her shortcomings — like saying we have a secure border with Mexico or confusing North and South Korea — to very good political effect.
Gail: Let’s go back to the president you … may be willing to vote to re-elect. He’s fighting hard to reduce federal student debt payments for low- and moderate-income people. I remember your not loving this idea in the past. Any change of heart?
Bret: Nope. The problem we have with the banks stems from what economists call moral hazard — basically, encouraging risky behavior. Pardoning student debt is another form of moral hazard: It encourages people to take out loans unwisely in the expectation that they might one day be forgiven. If we are forgiving college loans now, why not forgive mortgages next? Also, it’s an unconstitutional usurpation of Congress’s legislative prerogatives. Democrats objected when Trump steered Defense Department money to building the border wall without congressional authorization; Democrats shouldn’t further establish a bad precedent.
Assuming you see it otherwise.
Gail: Yeah. A lot of these people have been making loan payments for decades without making much progress in erasing the actual debt. None of them are rich, and a lot are struggling endlessly.
I can understand the resentment from folks who made a great effort and did pay off their loans. But we’re talking, in general, about people who were given the impression that borrowing large amounts of money to get a no-frills degree was a great investment that always paid off.
Bret: If the government is expected to backstop everybody’s bad or dumb decisions, the country would bankrupt itself in a week. Part of living in a free society is being responsible for your choices, including your mistakes.
Gail: I’m looking at this as a one-time shot that’s worth taking. But I have to admit I don’t love the idea of Biden acting without congressional authorization. Even though he wouldn’t have gotten it.
Sigh.
Bret: Never mind Congress — I can’t see this getting past the Supreme Court, so what we’re really talking about is another phony campaign promise.
Gail: Well, I guess it’s a case of what ought to be versus what can be. But I still think there should be loan forgiveness for those who’ve spent half their lives trying to pay off a debt they were generally too young and uninformed to realize they should avoid.
Really, Bret, who wants to perpetually punish people who fell for the siren call of “borrow money for your education”?
Bret: In the meantime, Gail, we have Wyoming outlawing abortion pills. We’ll need to devote more time to the subject soon, but all I’ll say for now is: When the world goes to hell, it has a way of getting there fast.
Gail: I’ve been thinking about Wyoming so much, Bret. Let’s go at it in depth next week. But if you hear that I was caught growling in public, you’ll know why.
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