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19 Nov 2008 03:12 pm

Baby, Meet Bathwater

Dean Baker argues progressives should be friendlier to true deregulation:

"In fact, progressives very often get the story quite wrong in characterizing issues as "government versus market." Certainly the current financial crisis provides an obvious example of such confusion. No one was really pushing for "deregulation" in the sense of getting the government completely out of the market. The financial industry's agenda was to get one-sided deregulation. They wanted to preserve the government security blanket of "too big to fail," while removing prudential controls that limited their ability to take on risk. In effect, what the financial industry wanted (and got) was government insurance that they didn't have to pay for. This surely is not the libertarian agenda; this is the agenda of a politically powerful industry (with allies in both major parties) that will get everything it can out of Washington."

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