Robert Samuelson gets it wrong yet again. In talking about the economic downturn following the collapse of the housing bubble, Samuelson tells readers:

"Home buyers had paid too much on the (false) assumption that prices would rise indefinitely. As real estate valuations crested in 2006, homeowners had to divert more of their income to repaying their mortgages and home-equity loans. Other consumer spending suffered."

Folks who have access to the data on the Commerce Department's website know that the problem was not that spending fell below normal in the crash, the problem is that spending was way above normal in the bubble years. The Fed somehow failed to notice the consumption boom that accompanied the construction boom, both of which were destined to end when the bubble deflated.

One other point that makes this assertion by Samuelson even more obviously wrong is that the massive wave of defaults that began in 2006 and picked up speed in 2007, 2008, and 2009 freed up hundreds of billions of dollars that would have otherwise gone to mortgage payments.

It is also worth correcting a couple of points on the bank bailouts. First, the Federal Deposit Insurance Corporation, which did not exist at the start of the Great Depression, could have kept the banks operating and ensured that the ATMs were working even if there had not been a bailout.

The second point is that, contrary to what was claimed at the time, the government held all the cards in setting the terms of the bailout. It could have, for example, required that any banks receiving money have a plan to downsize themselves over a five-year horizon so that none of their components were too big to fail. It could have made a condition of receiving bailout money that no bank employee will earn more than $500,000 a year in total compensation.

Since the banks were bankrupt, as Bernanke now argues, the executives would have had no legal option except to agree to these terms. (They have to act in the interest of their shareholders.) The bailout crew wanted to give the money with no conditions.

In terms of the hostility prompted by the bailout, if Timothy Geithner ever reads his autobiography, he will discover that he dismisses demands to help underwater homeowners by saying that many bought bigger homes than they could afford. By contrast, he dismisses critics of the bank bailouts as "old testament types." It is perhaps worth noting in this context that Mr. Geithner now works as a top executive of a private equity company where he almost certainly earns several million dollars a year, and quite possibly more than $10 million.