One thing every Hero does is define their Antagonist – the precise nature of the obstacle they must overcome. The Hero has a lot of leeway here, but because our point of view is partially determined by our past, every Hero has blind spots
Take the current economic crisis. If you are a Wall Street Insider you are likely to view the problem as one of “toxic loans”. It is the bad loans you made that are keeping up at night. What do you do about them? You get rid of them. Sell them to some sucker who doesn’t realize how toxic they are. And if you’re a Wall Street Insider who not so coincidentally happens to be the Secretary of the Treasury, well then you convince taxpayers to buy the junk for you. If you are Hank Paulson it makes sense.
But if instead you are an economist who has specialized in credit crises in a globalizing economy the problem isn’t just about bad loans, it is about frozen credit markets – banks that lack liquidity. Then the answer is to pump money directly into the banks – and because you don’t do that without some quid pro quo, you take a healthy share of the banks’ stock in return. That was the plan Paul Krugman has been pushing.
Since this isn’t a fictional story, these plans have real consequences that can be measured by the market. When the Paulson plan was announced markets went a twitter. When it was passed by Congress the Dow had the worst WEEK ever. When a variation of Krugman’s plan was adopted, with Britain in the lead, Wall Street had it’s best DAY ever. And as luck would have it, Krugman won the Nobel Prize for Economics.
Seems the the jury is in. Paul Krugman is our Hero.
Not that the recent stock pop will last – it probably won’t – but that the ideas behind it resonate with the people in the trenches. It is the Hero’s ability to inspire the folks on the firing line that makes the right story so central to real leadership.
Comments