Last Friday, Treasury Secretary Tim Geithner wrote a piece for the Wall Street Journal in which he accused critics of the new Dodd-Frank law of having “amnesia” in that they allegedly have forgotten the crisis of 2008. However, David John points out here that little of Dodd-Frank has anything to do with that crisis, what does pertain to it is heavy-handed regulatory overkill and — this is especially telling — that Geithner never once mentions the immense moral hazard the federal government introduced by its implicit guarantee that the mortgage-backed securities Fannie Mae and Freddie Mac were pouring into the market would be good.
Truths that are inconvenient to the proponents of the federal Leviathan are simply ignored.
