Zusammenfassung
The debate about the key causes of financial and economic crisis is as old as the study of political economy. As the quotes show, this debate already in the aftermath of the Great Depression has been led between those pointing out the inherent instability of an excessively de-regulated economy and those pointing to the excessive intervention of government and badly designed regulation in the economy.
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Notes
- 1.
As such, the German research fields of ‘Ordnungspolitik’ and ‘Wirtschaftspolitik’ encapsulate my research interest in banking regulation as an economic policy field best understood from a comparative economic systems perspective.
- 2.
A prominent example is the work by Ben Bernanke on the Great Depression, which emphasized the lack of active intervention by the central bank in the Great Depression as a negative contributing factor to the depth of the crisis, which most certainly also informed the Fed’s policy, over which he presided in this crisis, which has been generally assessed as very contructive.
- 3.
The sponsors of the legislation argued in a similar vein, as the New York Times reported on November 5,1999: “The world changes, and we have to change with it,” said Senator Phil Gramm of Texas, who wrote the law that will bear his name along with the two other main Republican sponsors, Representative Jim Leach of Iowa and Representative Thomas J. Bliley Jr. of Virginia. “We have a new century coming, and we have an opportunity to dominate that century the same way we dominated this century. Glass-Steagall, in the midst of the Great Depression, came at a time when the thinking was that the government was the answer. In this era of economic prosperity, we have decided that freedom is the answer.”
“If we don’t pass this bill, we could find London or Frankfurt or years down the road Shanghai becoming the financial capital of the world,” said Senator Charles E. Schumer, Democrat of New York. “There are many reasons for this bill, but first and foremost is to ensure that U.S. financial firms remain competitive.”
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Scherf, G. (2014). Prelude The financial crisis as a crisis of regulated capitalism. In: Financial Stability Policy in the Euro Zone. Springer Gabler, Wiesbaden. https://doi.org/10.1007/978-3-658-00983-0_1
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