How best to regulate Wall Street?

A summary of what's in the major U.S. newspapers.
March 23 2008 6:47 AM

Regulation Size Racket

 The New York Times leads with Congress and the White House debating whether or not to tighten regulation of the financial services market. The Washington Post leads with Bhutan preparing to conduct its first elections on Monday, despite resistance from some citizens who are wary of the tumult of electoral politics. The Los Angeles Times leads locally, with its top national story saying that Sen. John McCain is  staking his White House bid on the war in Iraq.

The NYT compares the debate surrounding the current financial crisis to the reaction following the Sept. 11 attacks. Just as the attacks highlighted problems with coordinating intelligence and law enforcement agencies, the paper says the current crisis points out the lack of coordination between financial regulators. The paper finds the White House and Congress sparring over how best to correct a flawed system of financial regulations that Wall Street has learned to exploit. The Bush administration favors streamlining regulations and possibly creating an umbrella agency to handle duties currently split between different regulatory bodies. Congressional Democrats, however, want to tighten the rules by applying banking regulations to investment firms. Both sides claim their solution will benefit the free market the most. The White House says that investment capital would wither if the industry were overly regulated. Democrats, however, say that unless the industry becomes better regulated, investor confidence will shrivel and take the market with it.

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The WP covers the ways in which the upcoming parliamentary elections in Bhutan will subvert expectations. Here, the paper says, is a country where a monarch is imposing elections on a hesitant public, rather than the other way around. Some voters tell the paper they're only supporting the election because their beloved king tells them it is necessary. Why would a monarch demand his people accept democracy? The WP posits that the king may be trying to raise his tiny country's profile and secure aide and allies to help Bhutan develop.

The LAT says Sen. McCain is hoping his support for the "surge" strategy will help him win the White House in the fall. But the war could be a double-edged sword for McCain, who might still have to answer for a string of bad calls leading up to the war in Iraq, including the assumption that U.S. troops would be greeted as liberators by the Iraqi people.

The NYT off-leads with analysis of McCain's trip abroad, calling it "an audition on the world stage," as McCain looks to prove he can bolster America's standing with the rest of the world. The paper concludes that while a change of tone from the Oval Office would be welcome abroad, many countries will still regard Iraq as the yardstick for how America deals with the rest of the world.

The WP off-leads with reports that the Bush administration is using a combination of regulatory shuffles and selective scientific findings to keep new species from being classified as endangered. The twist here is that the administration doesn't deny that they've been slow to give species legal protection; they just claim it's because of a backlog of environmental lawsuits that are tying up agency resources. The paper finds that environmental groups have been using the courts to get species classified as endangered with regular success.

The WP goes under the fold with a discussion of race and politics in Pennsylvania, focused on two Harrisburg-area American Legion posts, one predominantly white, one predominantly black. The story, based entirely on anecdotal evidence, concludes that blue-color white Pennsylvanians are still resistant to the idea of voting for Sen. Barack Obama.

Sen. Obama called for a national dialogue on race last week, asking all Americans to try to understand the problems facing other races. The LAT says that's all well and good- but what would that conversation look like? The paper tries to start one, and the answers it gets are at once refreshingly frank and painfully awkward. The authors do a good job of shying away from generalizations and pat conclusions until the very end, when they quote a subject saying that the morally complex issue of race isn't all "black and white." Maybe the writers felt like ending on a pun would cut the tension a little, but to TP's ear, it just falls flat.

The WP fronts the outrageous story of Saman Kareem Ahmad, a man who was denied a green card after 4 years of serving as a translator in Iraq, because he once belonged to a group that tried to overthrow Sadam Hussein.

You know things are bad in Haiti when people start to miss François Duvalier- but that's what's happening, says the NYT. The paper says Haitians increasingly pine for the relative stability of life under Duvalier and his son Jean-Claude. While Jean-Claude is currently living in exile, the piece says he's been mulling a return due to the recent waves of nostalgia.

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