City Journal, Spring 2009
The American system of financial regulation is a patchwork of agencies. At least ten federal regulators oversee financial-services companies; different regulators sometimes supervise the same entities; and since the onset of the financial crisis, regulatory agencies have taken on roles not originally envisioned or mandated, leading to further redundancy. This patchwork is not the creation of a schizophrenic legislator but rather the accumulation of a century of financial crises, each of which led to the creation of a new agency. In the current crisis, instead of forming yet another agency, we should rethink the country’s financial regulatory architecture entirely.
