Savings and Loan Bailout

"Lowy avoids the easy answers, like blaming it on fraud and greed, and explains how something of this magnitude could occur under the noses of those who should have protected the taxpayer." Paul M. Horvitz, University of Houston Market forces, not scoundrels, destroyed the savings and loan business. Lowy draws on years of experience in savings and loan institutions to provide an expert account of the problems that have overwhelmed the nation's S&Ls and government regulators. The book is written in a clear, readable style that allows Lowy to cogently describe the new market forces, new technologies, and mistakes made by regulators and S&L executives that spelled the end of the savings and loan industry.

Many Americans have viewed the S&L crisis as the ultimate example of greed's pervasiveness in our society. Yet the personalities that have dominated the news have obscured the real issues behind the worst debacle in our nation's financial history. Surveying the modern course of the thrift industry, from the Federal Home Loan Bank Act of 1932 to the current efforts at restructuring, Lawrence J. White addresses the essential questions of the S&L crisis: what happened, how it happened, why it happened, and what must be done so that it never happens again. White, who from November 1986 to August 1989 was a Board Member of the Federal Home Loan Bank Board--the government agency that regulated S&Ls and insured their deposits through the FSLIC--combines his knowledge as an insider with the insights of an economist to bring a much-needed fresh perspective on the S&L mess. He shows that, rather than the result of widespread fraud, the crisis was rooted in the highly unusual economic conditions of the early 1980s, poorly thought-out deregulatory policies, and flawed accounting practices. The S&L Debacle reveals that the banking system of the late 1970s was anachronistic. Tightly regulated thrifts were locked into portfolios of long-term mortgages and limited in the interest rates that they could pay to depositors. When interest rates soared, the thrifts experienced heavy losses. Clearly, adjustment in the industry was necessary, and the economic deregulatory policies implemented in the early 1980s were long overdue. But White points out that these policies should have been accompanied by strengthened safety-and-soundness regulations. Instead, safety-and-soundness rules were also deregulated, bringing a deadly combination of opportunities, capabilities, and incentives for risk-taking that spelled disaster for hundreds of thrifts--and ultimately for the FSLIC insurance fund and the U.S. taxpayer. White offers far-reaching recommendations for reform, such as better methods of gathering information about thrifts before they become insolvent, risk-related net worth requirements, risk-based insurance premiums--so that deposit insurance is treated more like other forms of insurance--and stronger powers of early intervention by regulators. With its comprehensive overview, incisive analysis, and clear, nontechnical language, this book is important reading for anyone hoping to understand the S&L crisis and will be an essential guide for economists and policymakers of the future.

"No More Taxes ... A Thousand Points of Light ... Reaganomics". The decade of the 80s in American politics is best characterized by these campaign catchphrases, for this was the Reagan-Bush era. For the first time, the social trends, world events, popular culture, and political climate of the Reagan-Bush administrations are presented in one ready-reference. The Encyclopedia of the Reagan-Bush Years takes a detailed look at the years 1980-1992 when Ronald Reagan and George Bush were elected to the Oval Office. The volume focuses on the individuals and events that directly relate to their administrations. Enhancing the descriptive entries are a chronology, statistical charts and tables, and photographs. As an added benefit for librarians and students using this source, the volume is thoroughly cross-referenced in boldface for ease-of-use. Favoring description over judgment while at the same time offering a sense of the controversy that surrounded, and in some cases still surrounds, the events and actions of the Reagan-Bush presidencies, The Encyclopedia presents a balanced account of this period in American history. This is the perfect first-stop for students and will fill a gap in public and high school library reference collections.

The arguments over the economic policies of the Reagan Administration will continue until sufficient time has elapsed for a consensus to be possible. In the meantime, it is necessary for contemporary scholars to record their opinions as a base for the consensus. Campagna has recorded his conclusions based on considerable research on Reagan Administration policies. He begins by describing what was planned by the government. From there, he discusses what actually happened, and devotes the remainder of the work to his opinion of what has been left with which the future must deal. Campagna concludes that the Reagan economic policies failed. He establishes a position for others to attack or defend in their own publications in the continuing argument.

The proper role of government in the U.S. economy has been the subject of ideological dispute for generations. In some recent variations the debate has ranged from purist advocacy of government "hands-off" to calls for protectionist policies and aggressive support for American businesses struggling in a cut-throat world market.

What is the reality? This question animates Richard Bingham's provocative study of industrial policy American-style, as practiced (if not preached) by administration after administration. Readable and enlivened with case studies, this book is accessible and of interest to anyone who follows business-government relations in the United States and abroad.