Dispelling The 'Deregulation' Myth

IBD Editorials ^ | September 19, 2008

[Kaslin]

Politics: A dubious and dangerous idea seems to be gaining strength — that government caused the financial crisis by giving capitalism free rein. If anything, it hasn't done enough of that.

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OK, we'll say it if no one else will: Thank heaven for Gramm-Leach-Bliley. If you've been listening to the fulminations from Congress and the campaign trail, you know that we're talking about the 1999 law that dismantled the Depression-era barriers between commercial and investment banking.

Democrats largely supported it at the time, and one of their own, Bill Clinton, signed it. Now they frame it as a Republican bill that helped send the nation on the path to perdition.

AFL-CIO President John Sweeney said it's time to roll it back: "The system of regulation of these integrated banks has failed, and it is clear that much stronger firewalls are needed." Majority Leader Harry Reid — one of 90 senators who voted for the bill in its final version — took off after its co-sponsor, Phil Gramm, who Reid said "was responsible for deregulation in the financial services industries that paved the way for much of this crisis to occur."

Maybe they know better, but they just can't resist kicking Gramm, who was dumped from John McCain's campaign back in July after suggesting that America had become "a nation of whiners." You don't scold voters in an election year, and Democrats still seem to think they can score points from Gramm's gaffe.

[xcamel]

Look at the state every single thing the government has its hands in, and you will see the true face of regulation.

[P.O.E.]

They’ve just gotten better at disguising how the strings are attached.

[what's up]

Thank God for Gramm and his bill.

It has allowed JPM to buy Bear and Bank of America to buy Merrill.

If these 2 things hadn't happened we'd be in far bigger trouble now.

[PowerPro]

This article is a breath of fresh air. I’m sitting listening to Hannity and Colmes and Alan and Nancy Skinner are attacking McCain and Bush on this very thing.

What makes this even more unpalatable is that they are stunned...STUNNED! that anyone would blame the democrats and their greed and scoff at the others who are making extremely valid points about Obama’s hands being dirty in this mess.

It’s maddening.

[org.whodat]

Yes, that's what we need, more and more bigger, to hell with competition. Bring on the big boys, that way they get so big they can’t fail and the tax payer will always be on the hook. "sac off"

Give them four years and then make them decide what business they want to be in and sell the other parts.

[buckeye12]

Bill Clinton did sign it, but only one democrat actually signed the bill. The vote tally was 54-44, basically along party lines.

The writer makes a valid point, but you don’t have to blur the truth to make your point more effective.

[dirtboy]

Spare me. Gramm is a poster child for how NOT to do deregulation - at the bidding of your lobbyist wife’s sugar daddy Enron.

[Howe_D_Dewty]

Please someone help me out.I thought the vote was 90 aye...8 nay.Perhaps I am thinking of another bill.
Thanks..

[palmer]

Bring on the big boys, that way they get so big they can't fail and the tax payer will

I say merge them all into one giant bank called Thebank or T for short. They can loan money to anyone at zero percent interest and sell securities called "T-Bills" to raise the money. Or just print it, doesn't matter. Then each of us taxpayers can sell credit default insurance on those T-Bills. But instead of sending money if T defaults, since we probably won't have any, we can all send a couple pints of blood or an extra organ that we don't really need.

[ronnie raygun]

I was also watching Hannity and Colmes tonight, Sean was not on, Colmes took over the show with his rediculous rants so I tuned it off! fridays ratings are in the toilet Sean!

[Texas_shutterbug]

"Spare me. Gramm is a poster child for how NOT to do deregulation - at the bidding of your lobbyist wife’s sugar daddy Enron."

Very few informed and/or honest freepers on here these days. We're all about propaganda for our side. I suppose that's inevitable considering how much the dems lie.

Thousands and thousands of people got screwed by Enron, and more are getting screwed by this deregulation. I'm sorry, but we're not living in colonial times when everyone knows who's the honest banker and who's the honest candlestick maker. We live in a highly complex society with a highly complex economy.

I, for one, am thankful for reasonable, sane regulation.

[anglian]

Did the Gramm-Leach-Bliley Act cause the housing bubble?
No. That is one common myth among the progressive left. More here, with lots o links.
http://www.marginalrevolution.com/marginalrevolution/2008/09/did-the-gramm-l.html

[agrarianlady]

bttt