"Renaissance Thinking About the Issues of Our Day"
More must be done to enhance growth now, which will give room to "get out economic house in order". Sacrifices alone will not boost long-term prosperity, and the short-term damage of severe "austerity" is obviously unacceptable (see Euro-zone). If the GOP has forgotten that the debt-limit agreement of last year already "triggered" debt reduction criteria, so, to what "lack of seriousness" about debt reduction does Mr. Boehner refer, I wonder? I believe that the lack of seriousness has been on the part of those who refuse to admit that tax breaks and shelters for already profitable sectors has not resulted in middle-class prosperity and that, when private resources are unavailable, government investment is essential. Mr. Boehner seems to think that it is "more irresponsible" not to cut back on grandma's health care or grandpa's SSI than to default on paying all of our bills. It is a lie to insist that stimulus has not worked or would not. Decreased "entitlement" and discretionary spending does not yield cost control, but does affect living standards. With regard to tax reform, was is not the GOP that blocks closing of loopholes and relaxing of oil industry subsidies? A gun to the head of the economy is not a diplomatic offer for compromise, in my opinion, and the Republican party leadership should be ashamed of holding us hostage.
Companies that engage in very risky behavior (credit default swaps, hedges, etc.) must be regulated in order to avoid the type of interconnected damage that led to the Great Recession, all reasonable folks agree. Arguments against regulatory rigor are out of touch, in my opinion, with the matter of facts. Regardless of the diversity of business models or assessment of "size" (too big), no automatic exemption from systemic importance should be given to specific companies - no bright line separates "safe" from "unsafe" models. I do not believe that proposed capital requirements or regulatory diligence arbitrarily "punish" non-bank institutions (such as insurance companies). I think that the broadest framework should cover enhanced prudential standards into which "risky" practices can fall (no excluding/hiding some). Thomas Quaadman (Chamber of Commerce) told the House Finance Committee that the "Title One" (Dodd-Frank) got the balance struck between transparency and regulation in relation to systemic risk with beneficial risk-taking was done well. Complaints were leveled against "bank-centric" definition of "systemically risky" institutions (not applicable to traditional insurance activities) being too narrow, and there is resistance to capital and liquidity levels required for "safety". Nevertheless, the problem of excessive extraction of wealth from commerce for the sake of creating wealth for its own sake has been proved too dangerous to continue unregulated, as any reasonable thinker knows. Stabilizing the financial sector and bringing down our debt are long-term priorities, for sure, but near-term growth, in my opinion, is most important.