On Up with Chris Hayes this morning it was interesting to listen to two panels discuss institutions and corruption without once discussing our statist government system and the need for limits placed on government power. They discussed Jamie Dimon's appearance before congress and, although Larry Lessig brought up the system that allows Big Banks to take unusal risks because the banks know government has their back, blamed private sector players and said nothing about the unintended consequences of statist interventions in the economy and central planning. In fact, the panel called for government to intervene even more.
To the Left, the problem with banks failing and the bailouts and the resulting housing crash and the resulting foreclosures and bankruptcies is that government didn't regulate enough, and now government needs to really crack down on the rich bastards. But, the panel says that government can't because the rich bastards have so much money that they can get by with anything, or something like that.
Once government is able to operate beyond constitutional limits the State grows naturally in power. It's the nature of the nation state to seek more power and control. Bureacracies grow up around the powerful State and an interventionist government and other dependent institutions serve to expand and protect the State's ability to control. The State and all its tenacles have no incentives to limit their own power -- the State, and the interventionist/statist government which protects the State, do what is necessary to expand power. The power of the State to pick winners and losers and to give favors and protection to its cronies and useful idiots in the private sector attracts the worst in business first -- the rent-seekers, the political animals who succeed through political favor. When other businesses realize that they have to play the political game in order to survive, they lobby government for favors, and, thus, corruption sets in.
The problem is tracing effects all the way back to causes. Causes and effects are so far removed in time that it takes a herculean effort to trace original causes to present effects, so shows like Up with Chris Hayes sit around dealing with symptomatic problems and solutions rather than fundamental problems and solutions.
It's critical to the future well-being and survival of America that we limit the power of the government so that the present State shrinks to its proper role or withers away as innovative private sector arrangements take its place. Do you want to get rid of the reign of Goldman Sachs? Limit government power and separate the State and the Economy. Dimon will have to compete again and prove he's the smartest guy in the room -- and that won't be easy. Plus, once left to private sector investors to protect themselves from fraud and corruption, they will do a much better job regulating and identifying the crooks, especially in the 21st century.