As I remember the story of Faust, in The Economist 's scenario, the bankers should be losing to government. I must tell you, if they are, it is not apparent to me. To the contrary, as I see it the bankers are winning. Bankers constantly remind us of the burden of supervision and regulation and its ever increasing intensity, and the restrictions that prevent them from meeting ever increasing competition. I would acknowledge both complaints.
Some bankers even speak of giving up their charters.
Nevertheless, I am not aware of a single bank that has relinquished its charter to relieve itself of these burdens and restrictions. For a number of reasons, I think the answer is obvious. First, deposit insurance continues to provide a substantial subsidy and bankers understand its vastly understated value. Second, notwithstanding the considerable amount of supervision and regulation imposed upon bankers, they are clearly getting the better of the bargain. In any case, the bankers had little to complain about.