Instant Amnesia — Or Something Worse?
If it exists, it’s possible.
Believe me, it’s not what it is.
–caption, New Yorker cartoon (what husband caught in bed with another woman says to his wife, standing in the doorway).
Let’s see: as every investor, saver, employed person and sentient being knows, the U.S. financial system — indeed, the global financial system — effectively crashed in mid-September, 2008.
The proximate cause was the failure of Lehman Brothers, which set off a horrific series of financial dominoes that threatened virtually every major global financial institution.
To stem the panic, sovereign governments around the world, led by the U.S., intervened with an unprecedented series of financial injections, guarantees, bailouts, etc.
Those actions appear to have stabilized the (economic) patient, but the prognosis — not to mention the staggering costs of said intervention(s) — have yet to be sorted out.
So, what are the defenders of the status quo, opposed to breaking up so-called “Too Big to Fail” financial institutions, calling for?
More study (just like global warming skeptics).
Consider this op-ed, from Friday’s Wall Street Journal:
Congress, as part of its reform legislation, should mandate the creation of a new expert commission designed to fully investigate the extent and consequences of interconnectedness before any new regulation of systemically important institutions is actually adopted.
–Hal Scott, “Do We Really Need a Systemic Risk Regulator?“; The Wall Street Journal (12/11/09)
Do we really need a “new expert commission” to tell us, years from now in mind-numbing jargon, what we just collectively witnessed?
Does this guy live in the real world??
Actually, he doesn’t: he’s a Harvard Law School Professor.