Raghuram Rajan has recently argued that American politics has made use of easy credit as a substitute for the welfare state. I haven’t read the actual paper to know if he is cited, but Monica Prasad evidently agrees with him in attempting to explain why America’s banking system is so heavily regulated but not robust to deregulation. The crash has created something of a populist moment on left & right, so it is interesting to hear a scholar point the finger back at us yahoos and (as I discuss in a comment) jibes with what I’ve read about the unusually fractured nature of our banking system.

On an unrelated note, a psychiatrist decades ago discovered a cure for the mental illness of hippiedom. On another unrelated note, Statsquatch has had some new posts after a period of inactivity.