I was Googling for a quotation by H.L.Mencken about how to deal with failing banks, and lo and behold, I found this, which it seems I wrote for Forbes in November 2oo8. The link in full is below. Here’s the money quote. I still believe that “perp walks” (or worse) are a more effective deterrent to dishonest, reckless or foolish management on Wall Street than all the regulations ever legislated.
“(One approach) is that, when a bank suspends payment, it would simplify matters to hang (or, in any case, to jail) all its officers and directors at once, whether its suspension be due to its roguery, to their stupidity, or only to their bad luck.”
Actually, Mencken is much needed at this moment. Here’s a useful compendium of his acerbic wisdom:
Speaking of Mencken, one of the books that I consider indispensable to serious consideration of what it means to be a proper citizen of this great republic is James Fenimore Cooper’s The American Democrat. It is little known. It was published in 1838, midway between the pub dates of Tocqueville’s Democracy in America, and I consider it to be, if not an antidote to the Frenchman’s great work, at least a useful vitamin supplement. After the book’s initial appearance, it wasn’t republished until 1936, with the Wall Street-induced Great Depression in full uproar. The new edition was put out by Knopf, with a curious, somewhat ambivalent introduction by Mencken, of all people. I say ambivalent because Mencken expresses a kind of pity for Cooper and the fruitlessness of his mission – a mission whose core values when it comes to a thinking man’s last best hopes for this country aren’t all that dissimilar.