Sunday, March 1, 2009

WaPo - We Saw It Coming (Financial Mess)

March 01, 2009
We Saw the Crisis Coming
By David Ignatius

WASHINGTON -- The big mistakes we make in life aren't the ones that sneak up on us, but those we make with our eyes wide open. That bit of wisdom comes from my friend Garrett Epps, a professor of constitutional law at the University of Baltimore. And it's powerfully true about the financial crisis that has enfeebled our economy.

Nothing about this crisis is really a surprise. People have been warning about it for more than a decade, in academic studies, official reports, Wall Street analyses, even op-ed pieces. Our smartest financiers, Warren Buffett and George Soros, saw it coming clear as a bell.

Yet the authorities did too little in the early years, when they could have had some effect. And once the full force of the crisis hit, officials became caught in a reactive cycle of incrementalism -- with each intervention setting up the next one. We have been dragged into the future by the weight of past mistakes, rather than charting a new course...
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