SOOTHSAYING

The Next Economic Crisis

In dealing with the current economic crisis, the government is using Wall Street to help recover from all the damage it caused. At the same time, the government is putting in place policies that will severely restrain Wall Street in the future. The New Yorker's James Surowiecki says this "balancing act" is cause for concern. Surowiecki asserts that the U.S. will weather the storm—like it has in previous crises—but that this may be more of a curse than a blessing. The financial system is so "fundamentally unhealthy, too big and volatile for anyone's good" that if it survives it will likely wreak havoc further down the road. There has been plenty of talk of reforming and regulating the system during other crisis, and nothing actually changed. A successful economic recovery may doom us to repeat our mistakes. "We've been like people living on a floodplain who during the deluge talk about moving or making the levees higher but end up rebuilding in the same spot," Surowiecki writes.