How to start fixing our financial and political mess
I just read a great New York Times editorial by Thomas Friedman about the current financial and political mess in the United States. Here's the part that everyone should read about how to start repairing the damage (#4 highlighting added by me):
Our Congress today is a forum for legalized bribery. One consumer group using information from Opensecrets.org calculates that the financial services industry, including real estate, spent $2.3 billion on federal campaign contributions from 1990 to 2010, which was more than the health care, energy, defense, agriculture and transportation industries combined. Why are there 61 members on the House Committee on Financial Services? So many congressmen want to be in a position to sell votes to Wall Street.
We can't afford this any longer. We need to focus on four reforms that don't require new bureaucracies to implement. 1) If a bank is too big to fail, it is too big and needs to be broken up. We can't risk another trillion-dollar bailout. 2) If your bank's deposits are federally insured by U.S. taxpayers, you can't do any proprietary trading with those deposits -- period. 3) Derivatives have to be traded on transparent exchanges where we can see if another A.I.G. is building up enormous risk. 4) Finally, an idea from the blogosphere: U.S. congressmen should have to dress like Nascar drivers and wear the logos of all the banks, investment banks, insurance companies and real estate firms that they're taking money from. The public needs to know.
Capitalism and free markets are the best engines for generating growth and relieving poverty -- provided they are balanced with meaningful transparency, regulation and oversight. We lost that balance in the last decade. If we don't get it back -- and there is now a tidal wave of money resisting that -- we will have another crisis. And, if that happens, the cry for justice could turn ugly. Free advice to the financial services industry: Stick to being bulls. Stop being pigs.
Did You Hear the One About the Bankers? - NYTimes.com
Labels: Commentary, Politics
