I thought Paul Krugman made some good points on the current investment banking situation in today’s “New York Times.” Here’s a clip:

…Traditional, deposit-taking banks have been regulated since the 1930s, because the experience of the Great Depression showed how bank failures can threaten the whole economy. Supposedly, however, “non-depository” institutions like Bear (Sterns) didn’t have to be regulated, because “market discipline” would ensure that they were run responsibly.

When push came to shove, however, the Federal Reserve didn’t dare let market discipline run its course. Instead, it rushed to Bear’s rescue, risking billions of taxpayer dollars, because it feared that the collapse of a major financial institution would endanger the financial system as a whole.

And if financial players like Bear are going to receive the kind of rescue previously limited to deposit-taking banks, the implication seems obvious: they should be regulated like banks, too…

The Bush administration, however, has spent the last seven years trying to do away with government oversight of the financial industry…

For example, there was a 2003 photo-op in which officials from multiple agencies used pruning shears and chainsaws to chop up stacks of banking regulations. The occasion symbolized the shared determination of Bush appointees to suspend adult supervision just as the financial industry was starting to run wild…

Just how fucking long is it going to take for us to put our country back together again, if it’s even possible? 20 years? 50 years? I wouldn’t have thought it possible to so thoroughly bankrupt our nation in 8 short years, but we’ve done it, and we’ve done it on every level — from economic to moral. But, I guess that’s what happens when two branches of government get scared shitless in the face of magnetized yellow ribbons and refuse to do the checking and balancing that they’ve sworn to do. I’m sorry, but I’m pissed off tonight. 4,000 dead Americans in Iraq, countless Iraqi lives ruined, financial collapse at our doorstep, soured international relations on every level, and for what? Higher dividends at Exxon and Haliburton?

I’ve said it before, but what really eats at me is the fact that it could have played out so much differently. If Gore were in power when the 9/11 attacks had taken place, he could have brought the nation together around an equally ambitious plan, but one that would have put our nation on a path to a better future. He could have taken the global goodwill that was extended to us, and used it to build a real international coalition to strike back at the Taliban and al-Qaeda. He could have taken the willingness to sacrifice for the greater good that all Americans were feeling, and channeled it into energy conservation and community building. Instead of spending billions on a misguided war in Iraq, he could have invested in solar projects here at home, creating hundred of thousands of new jobs in the process, and putting us on the path to energy independence. Instead, we squandered everything on a pitiful grab for what’s left of the earth’s oil. And, as if that weren’t enough, in the process, we abdicated our role as the moral leaders of the free world by disregarding our once sacrosanct constitution and embracing torture.

So, it’s not just that I detest Bush – it’s that I think about what might have been. That’s the part that really kills me. But, there is hope. Just now, I watched video of high school kids in the South Bronx talking about Barack Obama, and I feel optimistic. In spite of all the shit. Even with all the missteps. I look at these kids talking about how they feel that they can contribute to making our world a better place, and I can’t help but think there’s hope for us yet. We’ve got an unbelievable amount of work to do, but maybe we’ll make it.