If ‘Victory’ Looks Like This, Give Us Some Failure
U.S. lawmakers meeting in the wee hours Friday reached a compromise on a bill that will redefine U.S. financial markets and firms for decades, all but guaranteeing the White House its second major domestic policy victory this year. —The Wall Street Journal, June 25, 2010
So the Wall Street Journal describes the biggest financial overhaul since the Great Depression, agreed to after a 20 hour negotiating “marathon.”
And while we certainly hope the bill will do what its authors claim it will do—i.e. prevent another financial crisis—it’s hard to believe anything coming out of Congress, after an all-nighter, no less, will at the end of the day be more than a bunch of laws that make it tougher to do business here.
Our favorite provision—that mortgage lenders will now have to verify the borrower’s income, by gosh—tells you pretty much everything you need to know about how we got into this mess.
Unfortunately, the very structure of the discussions which led to this bill tells you how successful it will be in curbing financial speculation and future bubbles: probably not very.
That’s because, as in the healthcare “debate”—which was never really a debate, so much as a lecture from on high—the financial services “debate” included not one iota of analysis of how other countries actually accomplished good real-world outcomes during the crisis, as opposed to our very bad real-world outcome.
Did anybody on Capitol Hill bother asking themselves why Canada experienced no financial bubble, no housing crisis and no bank bailouts in the last three years? Anybody?
Of course not: that would be rational. And why would Congress want to be rational when so much money—and we mean campaign money—is at stake.
Still, the outcome here should be no surprise.
For all the talk during the recent healthcare “debate” of what a great job France, or England, or Sweden, or Canada does in providing universal healthcare to its citizens, nobody in Congress seemed to actually analyze those systems, and study how they might, or might not, apply here.
In fact, Congress didn’t even have to look overseas or north of the border to generate an informed view on real-world healthcare reform.
The Massachusetts Commonwealth has been trying to deliver universal healthcare to its 6.5 million patriots over the last three years. Anybody bother asking Massachusetts “How’s that going for you?” to judge how their experience might inform the effort to deliver universal healthcare to all 310 million Americans?
Nope. Instead, we got a healthcare “reform” bill put together by people who know very little about healthcare in the real world…and it came 20 years after such a bill might have helped prevent a problem in the first place.
Even worse, most of the healthcare “reform” particulars have been left up to the bureaucrats to implement, making employers reluctant to commit to new hiring at the very moment our economy needs new jobs the most.
All in all, healthcare “reform” looks a lot like today’s finance “reform,” come to think of it.
And both these pieces of paper, according to the Wall Street Journal, represent “victory.”
If ‘victory’ looks like this, give us some failure, please.
© 2010 NotMakingThisUp, LLC
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