in the NYTimes after the US House of Representatives voted „no“ on the Wall Street bailout plan. He’s right of course, that „flip-flopping“ on issues like this in the way it happened isn’t exactly a sign of a well functioning representative democracy. On the other hand, it’s also true that this vote is a sign that Congress still matters, even if it needed a figure with 11 zeros to balk at the administration. So, does that make the US a Banana Republic as Krugman argues? I think the decision on that is still out – after all, the bailout plan would/will have distributive consequences that would have/will make made the US income structure even more reminiscent of a classic Banana Republic.

Paul Krugman – OK, we are a banana republic