Adam Smith Institute

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The G-20 and our discontents

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“The era of bank secrecy is over," said Gordon Brown during the G20 conference on Thursday. The conference agreed upon imposing stricter regulations on financial markets, in addition to regulating hedge funds. The bonus crisis was also touched upon in their decision to strictly regulate executive pay. Furthermore, the final statement encourages the IMF and the World Bank to lend to poorer countries by pledging $250 billion.

What Gordon Brown really meant to say is that the era of privacy is over. Now the government will have their nose in every area of bank operation, imposing regulations and removing growth incentives for smaller firms and hedge funds, not to mention the pay incentives for executives. The rest of the measures taken will have questionable effects on the world market. More money is being pumped into the grinder, but until when?

The key question not being asked by many in the media is can we solve the problem with more spending and regulation?