Charles Schumer: Rethink Financial Regulation

By March 28, 2008Economy

Well-reasoned column in today’s Wall Street Journal by Sen. Charles Schumer (D-NY), “Regulatory Rethink.” This is a compelling point:

Look closely at unifying and simplifying our regulatory structure, perhaps moving toward a single regulator. In this era of global markets and global actors, we cannot return to the older model of separate businesses with separate regulators. We must consider whether a more unified financial regulatory system could provide more efficient regulation. In our report on maintaining the competitiveness of our financial sector, Mayor Michael Bloomberg and I suggested we should look closely at the system now in place in the United Kingdom. They have a single strong, effective financial regulator, focused on results and not rules, with the power to act. Such a regulator would likely have called in Bear Stearns managers and told them to improve their capital position long before the crisis arose, thus avoiding the backdoor action the Fed was forced to take.

Schumer adds a gratuitous knock against the Bush administration’s “hostility” to regulation, even though Treasury has been a consistent advocate of a single regulator for the housing-related GSEs. And the absence of any mention of Sarbanes-Oxley’s excesses jumped out at us.

Still, really good piece.

Join the discussion 2 Comments

  • kathy slater says:

    I would like to suggest you reinstate the blue law where the stores were closed on sundays . with the gas prices so high and climbing this may help I know it did years ago. plus a bonus, more family time

  • Craig Iskowitz says:

    A letter to the editors of the Wall Street Journal:

    Dear Sirs:

    It’s always refreshing when the editors print a light-hearted op-ed for a little change of pace from all of the political, moral and international issues we’re accustomed to reading here in the Journal.

    The piece you ran today by some humorist named Charles Schumer really tickled my funny bone, I have to say. This guy cracks me up! The whole article was hysterical, but the line that made me burst out laughing was this, “The goal of financial regulation is to encourage entrepreneurialism while ensuring the health of the financial system.”

    I darn near spit my morning tea all over the breakfast table when I read that one. Regulation that encourages entrepreneurialism? What a riot!

    Craig Iskowitz

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