Say Goodbye to the Reagan Revolution

Leaders abandon deregulation for a hands on approach
By Clay Dillow,  Newser Staff
Posted Jul 25, 2008 11:18 AM CDT
Federal Reserve Chairman Ben Bernanke has endoresed increased oversight at banks and underwrote the Bear Stearns buyout by JPMorgan.   (AP Photo/Susan Walsh)
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(Newser) – The Reagan Revolution, which ushered in a quarter century of deregulation, looks as if it's taken a stake in the heart, the Wall Street Journal reports. The Fed is offering tens of billions in emergency loans to failing banks, the SEC wants more power to regulate financial institutions, and the Treasury arranged JPMorgan’s purchase of Bear Stearns and then lobbyied Congress to prop up Fannie and Freddie. Is it dead, or just wounded, the Journal wonders.

By 53%-42%, Americans want the government to intervene more, a reversal of a dozen years ago when two-thirds opposed government action. Though a full-scale rollback of deregulation is unlikely, the Journal opines, failures by businesses like Enron and Worldcom, coupled with successes by agencies like the Fed in curbing inflation and limiting the pain of recessions have renewed Americans’ faith in state regulation.