Howard Gleckman

Howard Gleckman is editor of TaxVox, the blog of the Tax Policy center. He is also a senior research associate at the Urban Institute.

Recent Articles

An Unfamiliar (Economic) Game

Wall Street has become addicted to taking enormous risks and sticking taxpayers with the bill. As a result, financial panics are causing real recessions and returning us to the 19th century.

When a young Jack Nicklaus won the 1965 Master's Tournament, golf legend Bobby Jones said Nicklaus was "playing a game with which I am not familiar." I have the same feeling about today's financial markets. This is not capitalism as I learned it. Rather, for the past three decades financial engineers have been playing a game with unlimited upside reward and, thanks to the Federal Reserve and the White House, limited downside risk. The new rules: A $45 trillion market in immensely complex derivative securities, with no regulation, no capital requirements, no transparency, and a Federal Reserve that is so terrified of the consequences of this market blowing up that it seems prepared to bail out the losers at almost any cost. The perfectly predictable result is a Wall Street willing to peddle increasingly dicey paper in return for the promise of ever-higher returns. Who wouldn't, especially with the Fed prepared to cover your bad bets? The phenomenon has been around long enough to have a...