Just go read Terence Corcoran’s latest in the National Post. Never mind that the world was plunged into economic crisis by unregulated financial institutions and near fully captured regulators; never mind that by most accounts the financial regulatory reform that has taken place since has been mild and the regulators are still, for the most part, in the hostage room. Terence tell us that one of the central reasons for the continuation of the slump is:
Banks are being regulated to an extent never seen before, forcing the world’s core providers of credit for business expansion to curb their appetite for risk. Confusion reigns as global and trans-national regulators blunder their way to impose ill-conceived rules and policies. The hard reality of new rules, especially new capital requirements, is that it forces banks to accumulate risk-free liabilities while curbing risk-taking loans.
For the right it is always the same villain: the government. During the crisis they blamed the government because…wait for it…they did not regulate properly and the crisis was therefore evidence of state not market failure. Now, as then, it is the state that is failing, not markets.
To wit, Terence finishes with:
Similar government interventions, bolstered by constant calls for more spending and taxes, are the norm through most of the G20 membership. To end the many debt crises, the first step should be to abandon growth-killing policies. With growth, even debts cease to be a problem.
Just where is Terence getting his information from? The G20 is busy doing austerity across the advanced capitalist zone and not in the form of tax increases. Does he even read his colleagues blogs?