Gasoline, meet fire

As bad as the Congressional Republicans of 2000-2006 were, the Obama Democrats look likely to surpass them in terms of utter economic incompetence:

Democratic leaders have committed to enacting by the end of the year the biggest regulatory revision to the U.S. financial system since the 1930s – an undertaking so ambitious it has some lawmakers worried about missteps…. Obama wants to empower the Federal Reserve to oversee the largest and most influential financial firms. He also wants to create a council of federal regulators, chaired by the treasury secretary, to monitor risk across the broader market.

Let’s see. The Fed has “stabilized” the economy by destroying 95 percent of the dollar’s value in 96 years, “strengthened” the banking system by concentrating financial institutions so that a smaller number of banks with a larger amount of deposits are failing, and by preventing the 2001 recession by blowing the housing bubble that triggered the 2008 depression. And total credit market debt is now at 375 percent of GDP, higher than the previous high of 270 percent in 1933 or the 250 percent in Japan circa 1990.

Clearly, the correct solution is to give the arsonists more matches. Naked Capitalism has a review of the Obama proposal