There is an article in the New York Times on Sunday, March 22, 2008, about the split between Republicans and Democrats over the need for regulation of the financial services industry. This article illustrates why Democrats need to do a better job of linking the financial crisis caused by recent events such as the sub-prime mortgage meltdown and the collapse of Bear Sterns to Republicans. As much as Republicans may want to act as if these things just happen, there is a connection. That connection is that Republicans don't believe in regulation of business and therefore are ill equipped to deal with the problems caused by a very human condition: greed.
These financial crises take place when human beings want to make a lot of money. Now, on the one hand, to quote the character played by Michael Douglas in Wall Street, "greed is good." The desire to make a buck is what drives the American economy.
On the other hand, however, greed can cause human beings to do things that are bad for others. When the desire to make a buck overtakes any feeling of civic responsibility, then people start doing things that are bad for the rest of us. Things like loaning money to people who are not really able to pay the money back, or things like creating exotic financial instruments that investors don't really understand. Greed causes the strong to prey on the weak, all in the name of "rugged individualism."
That's where government comes in. Government regulation can level the playing field, make sure that the strong understand there are consequences to preying on the weak, or perhaps a better way to describe it is preying on the uninformed. Wall Street executives, like most of us, don't want to go to prison or have their reputations ruined.
When liberals try to pass legislation banning discrimination of various kinds, conservatives often claim that liberals just don't understand human nature. They claim that human nature is what drives people to discriminate and "you just can't change human nature." Well, if that is so, then one thing that you can't change is the all too human condition of greed. You can, though, regulate it. Something that Republicans just don't want to do.
The issue facing Democrats is how to make that lack of will to regulate business understandable to American voters. Here's a suggestion: Start talking about the greed of Wall Street executives. Americans understand simple, clear language. Instead of talking about hedge funds and sub-prime mortgages until voters' eyes glaze over, talk about the need to control human greed. In other words, don't talk details, talk philosophy. People elect officeholders based on philosophy. It is the officeholders job to then attend to the details.
All too often, the only side talking about philosophy is the GOP. They explain their attacks on government by saying things like "big government is bad." The way to counter that is not to list all the beneficial programs that Democrats have passed, the way to counter that is to have a equally clear message. On regulation of the economy, the clear message should be that "humans are greedy and greed needs to be controlled." A clear, simple message beats a complicated message every time.