New Op-Ed on Expanding the Fed's Regulatory Powers

The Cato Institute has just published an op-ed of mine titled Giving the Fed New Powers Ignores History.

Summary:

Like the child who murders his parents and then asks for pity because he's an orphan, the Federal Reserve has a long history of asking for more regulatory powers to clean up messes for which its action or inaction is the primary cause….

The history of banking in the United States and elsewhere does not show that the industry is beset by market failures that require regulatory intervention. To the contrary, almost every major crisis faced by the banking system has been the consequence of already-existing regulations, many of which came about as responses to previous crises caused by older regulations. Countries, like Canada, where some of the worst of these regulations were absent, have not had the same history of crises as has the United States. Perhaps this time we will learn from history and avoid a new regulatory regime that will create new threats to an already somewhat shaky U.S. financial system.

Cross-posted at The Austrian Economists