Sun Post #1: Common Sense

Great 10 minute speech by MEP Daniel Hannan who examines the ongoing Great Financial Crisis very succinctly.

He begins this thoroughly British demolition of status quo by looking at the three critical myths surrounding the financial crisis that we are still living through. Those myths are:

• That this crisis was caused by the failure of Capitalism,
• that the banking collapse was caused by a lack of regulation,
• and that we have been brought here by greed.

Hannan argues the past and present bailouts of each and every bank (and 'important' industry) will, one day, be seen as a generational offence.

Hannan argues capitalism has not failed, it has been undermined by political pandering. Subsidies and nationalizations are the opposite of capitalism. In a capitalist system, bad banks would have failed. Their profitable operations would have been sold to more efficient competitors. Bond holders would have lost money, shareholders would have lost money, some depositors would have lost money and taxpayers would not have contributed a penny.

What about the idea there wasn't enough regulation? Hannan notes no industry is more regulated than the financial industry. He states by responding the crisis with more regulation, we repeat the mistakes that were made originally and we make the next crisis more likely.

We have too big to fail banks because we don't allow the market to follow it's course.

Finally Hannan takes on the idea that defending these viewpoints is championing greed.

Hannan suggests in a brief but extremely eloquent debate that there is a world of difference between being pro business and pro market as he destroys any semblance of credibility that the political (and elite) class has echoing a young Ron Paul in his thoroughly libertarian free-market sensibilities.

(hat tip to Zero Hedge)

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