At Political Civility, Lyall is discussing the economy, government bailouts, and financial regulation. He infers that if elected Barack Obama will over increase regulation (somehow missing the past several hundred billion dollars the Bush administration has expended in market intervention) and Democrats will push more government intervention into the market, and that doing so will reek disastrous results. While I'm no fan of over-regulation, I'm even less a fan of the Treasury Department throwing cash at a banking industry that has proved incapable of making prudent lending decisions over the past decade.
In rebut to a comment blaming Republicans he points out theories that the subprime mortgage market was sparked by well-intended Carter/Clinton policies regarding the Carter-era Community Redevelopment Act, and therefore the blame for the current market woes falls (not wholly, but in part) with the Democrats. This was later brilliantly impeached by bekkieann who pointed out that it was lenders misuse of the deregulation provided by the CDA that has led to the current crisis:
"Clearly lenders took a concept intended to help low-income people and extended that concept to those who did not need that type of financing, and a lot of people got way in over their heads.
Do you know anyone who had/has an ARM? What income bracket are they in? I know some in my own income bracket. We are not poor.
Deregulation allowed lenders to perpetrate this financing scam on Americans who were eager to live beyond their means. "
In the current situation, increased regulation is warranted and deserved on a banking industry that failed to perform due diligence in lending practices for the past several years. Bailouts of the banking industry, without stringently increased lending regulations is an offense to the American taxpayer footing the bill. (For starters, make sure mortgage originators are qualified to evaluate a customer's ability to repay, objectives in obtaining financing, and matching proper mortgage products to their customers -- Stock brokers need to prove their competency in these respects and individuals suggesting mortgage products should be have these same demonstrable competencies.)