Joe Nocera and Bethany McLean
Essay by co-author via Financial Times
Legislators and regulators give a great deal of lip service to the importance of small banks and small business — but in reality, their actions almost always aid the big at the expense of the small, particularly when it comes to banks. Yet without small banks, small business will struggle.
Starting with bank deregulation in the 1980s, and then the response to the global financial crisis, we’ve made big banks bigger at the expense of the small. This despite the fact the crisis was caused by the big banks, not the small ones (and the small ones didn’t need bailouts). From 2002 to 2022, the number of banks insured by the Federal Deposit Insurance Corporation declined by nearly half.
