Government Capitalism

By Bill Glynn

K Street to Look Over the Back of Wall Street

Government capitalism - more like socialism - is still trying to take a larger and larger administrative role in how Wall Street operates. But Wall Street just isn’t going to go along with it. Yes, Wall Street was largely to blame for the economic implosion. And now the government wants to step in and regulate how the firms operate and how they pay people. That isn’t the government’s job. They can create legislation empowering the SEC and the treasury/fed with powers to force regulations and standards upon Wall Street, like the Sarbanes-Oxley act of 2002, but they cannot and will never be able to control the price people are willing to pay for talent. This at the core of capitalism. All eyes are focused again on the high pay of executives on Wall Street. Obama will speak today about this very subject and to a lesser amount about the actual regulatory specifics that need to change. Oh, by the way, this needs to happen globally, too, where the U.S. has no power at all. Regulations and more power being held by the SEC will happen and a lot of that good to reign in pandemic possibilities and rogue practices, but talent is a fluid resource that will go where the money is and, hence, take the business and clients with them. [more...]