Charlie Munger had an editorial in the Washington Post yesterday. I bet it’s quite easy to get an editorial in a paper when you own 21% of it! Anyways, Munger feels the key to restoring confidence is new legislation that will stamp the sins and follies of the past:
Our situation is dire. Moderate booms and busts are inevitable in free-market capitalism. But a boom-bust cycle as gross as the one that caused our present misery is dangerous, and recurrences should be prevented. The country is understandably depressed — mired in issues involving fiscal stimulus, which is needed, and improvements in bank strength. A key question: Should we opt for even more pain now to gain a better future? For instance, should we create new controls to stamp out much sin and folly and thus dampen future booms? The answer is yes.
Sensible reform cannot avoid causing significant pain, which is worth enduring to gain extra safety and more exemplary conduct. And only when there is strong public revulsion, such as exists today, can legislators minimize the influence of powerful special interests enough to bring about needed revisions in law.
However, legistlators are having a tough time working together in a bipartisan way. Munger seems to be worried about this apparent fact. But the petty bickering in Congress seems to be in relation just to a stimulus package. I believe that once the fools in Congress start to work on comprehensive reform legislation, legislation that completely reworks and strengthens the regulations governing the financial industry, the American public will begin to see some true bipartisanship.