A small story in the New York Times on October 3, 2008, tells the story of how the five biggest investment banks, including Goldman Sachs, then headed by Henry Paulson, now our Treasury Secretary, won approval of new deregulation from the Securities and Exchange Commission. The action was little noticed at the time, but it was apparently one of the key de-regulatory moves that led to the currently spiraling crisis, which is going to need new rules as well as new money before it's over.
This is a story of greed, negligence, and misguided ideology. It is not going to be fixed by moralizing from John McCain about a few bad apples on Wall Street and at the SEC, but by serious attention to fixing the rules of the financial markets.
"S.E.C.'s 2004Rule Let Banks Pile Up New Risks," New York Times, 4 October 2008.
Stephen Labaton, "The Reckoning -- Agency's '04 Rule Let Banks Pile Up New Debt," New York Times, 2 October 2008.