Senior Fellow Peter J. Wallison

Deregulation has met with such success--in trucking, airlines, telecommunications, securities brokerage, and many other economic sectors--that it is now hard to find defenders of continued or increased regulation. That is why Jonathan Macey's recent article "Commercial Banking and Democracy: The Illusive Quest for Deregulation" is so interesting.

Macey is a well-known and highly respected scholar who has written extensively on the regulation of securities and banking. Generally, he is skeptical of regulation; if he defends regulation, one would expect a well-reasoned and persuasive case. In that sense, his article is both a disappointment and an encouragement--a disappointment because the case Macey advances for the continued (or increased) regulation of banks turns out to be so weak, and an encouragement because the very weakness of Macey's case suggests that bank regulation--while it retains support among the political class--is losing its intellectual foundation. As one who has questioned whether bank regulation is any longer necessary, that is good news. . . .

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Peter J. Wallison is a senior fellow at AEI.