Power. Economists Simon Johnson and James Kwak present a little more than two hundred pages of clear and straightforward writing in their new book, 13 Bankers: The Wall Street Takeover and the Next Financial Meltdown. In a calm and reasoned way, the authors present an overview, context and historical perspective about many of the factors that led to the recent financial crisis, and how despite rhetoric about reform, we seem to be back to business as usual. Consistent with the principles of Thomas Jefferson, Johnson and Kwak express concern about the problems of concentrated power. They show clearly that a handful of privileged banks remain too big to fail, and continue to take risks that could lead to another crisis. Here’s the point (p. 180): “The large banks used their political power to protect their money machines from government interference, and when those machines exploded they used their size and importance to force the government to bail them out.” Johnson and Kwak propose capping the size of banks. At times, this book reads like a recap of the news headlines of recent years, but that adds to its readability, which is not a bad thing for a book written by economists. Any reader interested in a recap of what brought us to today’s concentrated risks, how past leaders broke up powerful concentrated entities, and how the current power of big banks puts us in jeopardy, will find a lot to ponder from these pages.
Rating: Four-star (Highly Recommended)
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