Liberals and conservatives are both right about big banks | AEIdeas: An elite academic criticizes capitalists; a conservative condemns overregulation. Seems like standard fare. But when we look beyond the tired, old narrative of right-wing business backers versus left-wing government cheerleaders, a surprising truth comes into focus:
Both critiques are on point.
Big banks do have it too easy. Per the chart below, America today is just as reliant on a few colossal institutions as before the meltdown. This is great news for those deemed too big to fail: Bloomberg View estimates that implicit guarantees boost megabank profits by more than $80 billion. Less lucky are the smaller firms that receive no such subsidy — not to mention the taxpayers.