… will happen again.
First, a passage from HG Wells (via Dani Rodrik):
Everywhere as the Conference drew near men were enquiring about this possible new leader for them. “Is this at last the Messiah we seek, or shall we look for another?” Every bookshop in Europe proffered his newly published book of utterances, Looking Forward, to gauge what manner of mind they had to deal with. It proved rather disconcerting reading for their anxious minds. Plainly the man was firm, honest and amiable, as the frontispiece portrait with its clear frank eyes and large resolute face showed, but the text of the book was a politician’s text, saturated indeed with good will, seasoned with much vague modernity, but vague and wanting in intellectual grip. “He’s good,” they said, “but is this good enough?”
He speaks, of course, of Roosevelt and the expectations in 1933 before the representatives of leading nations met in London to find a way out of the Great Depression.
Now let us fast forward 66 years, to 1999 and landmark legislation to repeal the Glass-Steagall Act of 1933 that passed congress with bipartisan support:
Congress approved landmark legislation today that opens the door for a new era on Wall Street in which commercial banks, securities houses and insurers will find it easier and cheaper to enter one another’s businesses. [...]
”Today Congress voted to update the rules that have governed financial services since the Great Depression and replace them with a system for the 21st century,” Treasury Secretary Lawrence H. Summers said. ”This historic legislation will better enable American companies to compete in the new economy.”
That’s Obama’s economic adviser Larry Summers, just so we’re clear. But this is the real money quote:
”I think we will look back in 10 years’ time and say we should not have done this but we did because we forgot the lessons of the past, and that that which is true in the 1930’s is true in 2010,” said Senator Byron L. Dorgan, Democrat of North Dakota. ”I wasn’t around during the 1930’s or the debate over Glass-Steagall. But I was here in the early 1980’s when it was decided to allow the expansion of savings and loans. We have now decided in the name of modernization to forget the lessons of the past, of safety and of soundness.”
Dorgan was one of only 8 senators to oppose the bill.
UPDATE (3/31): NPR’s All Things Considered had a feature today drawing parallels between the circumstances surrounding 1933’s London conference and Obama’s summit with the leaders of the G-20 this week.
The mood was dark, but there was still hope: The United States had a dynamic new president, Franklin Delano Roosevelt. He had taken office just three months earlier, and the world was waiting to see what he would do.