Regulation might save the economy - but it won't save democracy

The collapse of Silicon Valley Bank was the largest since the financial crisis and a whole new generation of people are learning why the economy isn't as predictable as we want it to be. <br><br>This is not the first bank to collapse - in the 1980s, more than 700 S&Ls (Savings and Loans) collapsed. In the 1990s, the Japanese government let its banks fail and Finland and Sweden suffered bank failures. In 2008, the entire system nearly collapsed and needed more than a decade to recover. <br><br>Banks collapsing are the only constant in a changing world. <br><br>So the Biden Administration stepped in to save depositors. I genuinely do not blame them. It was the right move. But I *do* blame them for not taking steps to stop it in the first place. <br><br>The reason that SVB collapsed is a lack of regulation - and I don't mean that lightly. <br><br>The reason that SVB collapsed is that the *Trump administration deregulated banks* including SVB, allowing itself to stops its asset-liability management and diversify its investments, turning itself into a hedge fund that - surprise! - went bust. <br><br>But this is even worse than it seems, because the reason the Trump Administration was able to deregulate the banks is because of a *Democratic* Senator named Mark Warner. Why did Senator Warner vote to deregulate banks? The answer is simple: *he got bought off*. <br><br>The same people who spent decades telling you regulation was bad for the economy spent decades buying off politicians and corrupting institutions to stop you from getting the regulation you deserve. They have spent their careers pitting us all against each other while they make off with the wealth we create. <br><br>So when the banks fail - they are the first to cry out for bailouts. By contrast, workers who have been screwed over are never bailed out. Homeowners who get foreclosed are never bailed out. Students who can't pay their tuition are never bailed out. <br><br>Why does it always seem like the economy is unpredictable and fragile? Why does it always seem like the economy needs bailouts while working families do not? <br><br>Well, that's because both the economy and democracy are made of the same thing: trust. <br><br>When you deposit money in a bank, you are making a bet that the bank will stay standing when you get your money out. When you vote for politicians, you are making a bet that they will do the right thing when they get your vote. <br><br>We can bail out the banks. We can put in regulations to stop them from happening again. But who will bail out democracy? Why should we trust voting? Why should we trust politicians? <br><br>We are learning that the answer is that we should not.