How to Fix the Financial Crisis

“The financial crisis in America isn’t over,” says James Galbraith. The renowned economist explains how restoring the rule of law on Wall Street should be the nation’s top priority. “To restore the rule of law means first a rigorous audit of the banks and of the Federal Reserve. This means investigations. It means criminal referrals from the regulators, from Congress, and from the new management of troubled banks as they clean house. It means indictments, prosecutions, convictions, and imprisonments. The model must be the clean-up of the Savings and Loans, less than 20 years ago, when a thousand industry insiders went to prison. Bankers must be made to feel the power of the law in their bones. How will this help the economy? The first step toward health is realism.”