[msandford]

Personally I think that the growth of the banking sector is the problem, as it tends to capture more and more of the profits and allocate them to the pay of the bankers. It's also a brain-drain on other industries. Finally, the banks do occasionally lose everything and then we have to bail them out.

Remove the "bail them out" part of the process and you'd likely see a fair amount of income equality restored. Banking has a concentrating effect on the economy, and the bigger the bank the more concentrating it is.

If we had banks small enough to fail, they'd still concentrate but to a much smaller degree. That'd be good for income equality and good for putting smart people to work in favor of small businesses instead of against them, and good for reducing the tax burden on the non-rich who ultimately fund the bailouts.

[walterbell]

We know when the firewall was turned off:

https://en.wikipedia.org/wiki/Glass–Steagall_Legislation

https://en.wikipedia.org/wiki/Gramm–Leach–Bliley_Act

[msandford]

I'm not sure that repealing Glass-Steagall was the problem. We did have the savings & loan crisis and that was prior to the repeal.

Personally I think it has more to do with the banks going public and then being on the treadmill of ever increasing profits. The NYT has a piece on the issue from 1999.

http://query.nytimes.com/gst/fullpage.html?res=9C03E7DF1639F...

Slate also documents the banks going public, again prior to repealing Glass-Steagall.

http://www.slate.com/articles/business/moneybox/2010/01/the_...

[tunap]

Consolidation of oligops, helped too, corporate welfare has always been the norm & the revolving door b/t industry & regulators is a new-ish trick they seem to have mastered to a T. The Commodities Modernization Act of 1999+Financial Services Commodities Act of 1999 were not the bills that killed Glass-Steagall, but they were the final stake in the heart of the GD I protections that have been eroded over the last 30 years, or so. Frontline had a great doc'y on it years ago documenting the billions of lobbyist dollars that went into the piecemeal dismantling the G-S Act, but I cannot locate it currently(my n900 is almost just a phone these days...which is nice). Now that we are entrenched in the GD II, aka the 'Great Recovery', we can use some of our idle time to look back at commodities and securities price graphs over the last 20-30 years. It may be a coincidence that prices tripled, quadrupled & quintupled since 2000, but I doubt it. It took them 7 years to ruin the world economy and it would have come quicker if 9/11 hadn't made them pause to shed some crocodile tears.

PS: hey Walter, to answer your questions from last month I can no longer post to: Yes & Mostly abstinence. More I rely on an org, the more I am beholden to them. Stick mostly to bare essentials.

[walterbell]

The world is going to need a "minimal tech" community to share best practices :)