Monday, October 15, 2012

George Will: Dodd Frank, Capitalism, & Banks Too Big To Fail

Capitalism — which is, as Milton Friedman tirelessly insisted, a profit and loss system — is subverted by [banks deemed "Too Big To Fail"], which socializes losses while leaving profits private. And which enhances the profits of those whose losses it socializes. TBTF is a double moral disaster: It creates moral hazard by encouraging risky behavior, and it delegitimizes capitalism by validating public cynicism about its risk-reward ratios.

George Will, Too Big To Maintain?, Washington Post, 12 Oct. 2012

Amen. Do read George Will's exceptional column, discussing what Romney referred to in the last debate, that the Dodd-Frank law "constitutes “the biggest kiss that’s been given to — to New York banks I’ve ever seen.”

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