One quick observation: I'm glad that, in one respect, George W. Bush did exactly the same thing as Bill Clinton: picked a former chairman of Goldman Sachs as Treasury Secretary (Clinton's choice was Robert Rubin, Bush's was Henry Paulson). I'm not sure I agree with Paulson - jury's still out on exactly what he's doing - but at least he projects a sense that he knows what he's doing, and he's capable of making decisions quickly. At this point, I think I'm glad that Bush seems almost irrelevant to managing this crisis. We should be thinking of Bush at this point in terms of the Hippocratic Oath: first, do no harm.
The terms of the debate are already taking shape: how much oversight should the government have? Decisions made in the next few weeks will have reprecussions for years, if not decades. Obama is coming down on the right side.
- No blank check.
- Rescue requires mutual responsibility.
Taxpayers should be protected.
- Help homeowners stay in their homes.
- A global response.
- Main Street, not just Wall Street.
- Build a regulatory structure for the 21st Century.
My gut reaction comes down to this: the two driving forces on Wall Street are greed and fear. Everybody in finance knows that. Crises develop when one dominates, and is not balanced by the other. As people are successful, fear recedes, and greed takes over.
The purpose of regulation is to serve as a controlled and constant application of fear, to counterbalance greed.