He calls it Politics, I call it the Financial Oligarchy

Tyler Cowen writes an general op-ed on how Poliics now runs the financial sector in Where Politics Don’t Belong:

President Dwight D. Eisenhower warned of the birth of a military-industrial complex. Today we have a financial-regulatory complex, and it has meant a consolidation of power and privilege. We’ve created a class of politically protected “too big to fail” institutions, and the current proposals for regulatory reform further cement this notion. Even more worrying, with so many explicit and implicit financial guarantees, we are courting a bigger financial crisis the next time something major goes wrong.

I call this the financial oligarchy or multinational corporations took over Washington D.C.

Cowen also notes the lastest deals with big business have turned off many who are in favor of health care reform.

The Battle of the Regulators

Regulators are in a power struggle as new policy proposals as well as Congress mull regulation reform of the financial system.

John C. Dugan, the comptroller of the currency, blasted a proposal to impose stiff new insurance fees on banks as unfair to the largest banks, which he regulates. The financial crisis stemmed in part from problems at small banks, he insisted.

Sheila C. Bair, chairwoman of the Federal Deposit Insurance Corporation and the regulator for many smaller, community banks, could barely hide her contempt. The large banks, she said, had wreaked havoc on the system, only to be bailed out by “hundreds of billions, if not trillions, in government assistance.” She added, “Fairness is always an issue.”