Goldman Chair Acknowledges Need For Financial Regulation

by Stuart Shapiro

It’s not often that you’ll hear me praise someone from Goldman Sachs.  Then again, it is not often that you will hear a top banker say something in favor of government oversight (are you listening, Governor Romney?):

Lloyd Blankfein, chairman and chief executive of the largest U.S. investment bank, said he sees financial regulation evolving now just as it did in the aftermath of the Great Depression of the 1930s.

“You have to go out and you have to take steps. You have to have different regulation, maybe more regulation in certain respects,” he said, while addressing a room full of bankers and lawyers on Bay Street — the financial hub of Toronto.

“I think it is absurd to talk about just the burdens of regulation without talking about what’s driving people to want to regulate,” said Blankfein, who was fielding questions posed by Gordon Nixon, CEO of Royal Bank of Canada.

Regulations have costs but they also have benefits.  Anyone who talks about one side without the other is misleading you (are you listening yet, Governor Romney?).

By: Stuart Shapiro

Stuart is a professor and the Director of the Public Policy
program at the Bloustein School of Planning and Public Policy at Rutgers
University. He teaches economics and cost-benefit analysis and studies
regulation in the United States at both the federal and state levels.
Prior to coming to Rutgers, Stuart worked for five years at the Office
of Management and Budget in Washington under Presidents Clinton and
George W. Bush.