I pointed out yesterday that even conservatives like Ben Bernanke agree on the need for congress to pass some form of “resolution authority” regulation, empowering the government to deal with failing financial institutions that aren’t covered by the FDIC process. That’s clearly a necessary step to dealing with the “too big to fail” issue, and some people even think it’s sufficient.
And then there’s Edward Yingling, the banksters’ top lobbyist, who’s against the idea on the grounds that it “could make it unnecessarily more expensive for them to do business during less turbulent times.” As Pat Garofalo observes “as for ‘unnecessary’ expenditures, I’d like to ask Yingling what he thinks of the $700 billion spent to pull the banking system back from the brink.”
But, look, this is just zealous advocacy on Yingling’s part. It’s clearly preferable for large financial firms that they be allowed to exist in a way that ensures the taxpayers have no choice but to cover their losses in the case of screwups. Anyone with any sense would jump at the chance to privatize profits and socialize losses. It’d just be insane of congress to let them keep getting away with it. Y