Paul Krugman examines the roots of our current economic collapse and finds that they started with…Ronald Reagan. Specifically, Reagan’s decision to deregulate private finance.
Did you know that before Reagan, the government mandated the size of house downpayments?
[T]he more one looks into the origins of the current disaster, the clearer it becomes that the key wrong turn — the turn that made crisis inevitable — took place in the early 1980s, during the Reagan years.
Attacks on Reaganomics usually focus on rising inequality and fiscal irresponsibility. Indeed, Reagan ushered in an era in which a small minority grew vastly rich, while working families saw only meager gains. He also broke with longstanding rules of fiscal prudence…
The increase in public debt was…dwarfed by the rise in private debt, made possible by financial deregulation. The change in America’s financial rules was Reagan’s biggest legacy. And it’s the gift that keeps on taking.
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