A history of major financial crises—and how taxpayers pay the price

NEW From Yale University Press

 

"...the story of banking...in romping 

fashion."


"...panoramic and insightful" 


"Buckle in..."

Broken Bargain: Bankers, Bailouts and the Struggle to Tame Wall Street

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Ten years after the Great Recession, a history of major financial crises—and how taxpayers have been left with the bill​

In the 1930s, battered and humbled by the Great Depression, the U.S. financial sector struck a grand bargain with the federal government. Bankers gained a safety net in exchange for certain curbs on their freedom: transparency rules, record-keeping and antifraud measures, and fiduciary responsibilities. While these regulations have evolved over time, the underlying bargain played a major role in preserving the stability of the financial markets and the larger economy. By the free-market era of the 1980s and ’90s, however, Wall Street argued that rules embodied in New Deal–era regulations to protect consumers and ultimately taxpayers were no longer needed—and government agreed.

This engaging history documents the country’s financial crises, focusing on those of the 1920s, the 1980s, and the 2000s, and reveals how the more recent crises arose from the neglect of this fundamental bargain, and how taxpayers have been left with the bill.

NEW From Yale University Press

Featured on the "Page 99 Test" of the Campaign for the American Reader: http://bit.ly/2E76NBZ

Kathleen Day...

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...has worked for thirty years as a business reporter for the Washington Post, Los Angeles Times, and USA Today. She joined the Johns Hopkins Carey Business School in 2013 as a professor of financial crises. She lives in Washington DC.


Also by Kathleen Day: S&L Hell: The People and the Politics Behind the $1 Trillion Savings & Loan Scandal

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BusinessWeek named it one of the Top 10 business books of the year

Recommended reading by the New York Times Sunday Book Review

Starred Kirkus Review, https://bit.ly/2DF49px

Finalist: Helen Bernstein Book Award for Excellence in Journalism

Reviews, Interviews, Articles & Podcasts

REVIEWS

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Foreign Affairs:  Day tells the story of U.S. banking...in romping fashion....[including the]  troubling story of the last 40 years, during which... in large part thanks to lobbying and campaign contributions by financial firms, Congress rolled back regulations. 

https://fam.ag/2JpL4em


Kirkus: A "well-defended

account...showing...humans do not learn from history. A fluent if dispiriting study of an economic system that forgives those at the the top as long as those at the bottom remain willing to foot the bill."

--Kirkus Reviews, https://bit.ly/2zdercv


“Day has written a sweeping account of financial calamities. She shows how often we’ve been wracked by crises, and how quickly we forget why, setting up the next one.  Buckle in.”

—Mark Zandi, Moody’s Analytics 


"Day, a professor at Johns Hopkins University, shows how, for nearly 40 years, the US banking lobby has been getting votes from Washington for laws that routinely hurt taxpayers....[important] historical reminders..."

  ---Norbert Gaillard, Foreign Policy: Politique Etrangere  http://bit.ly/31w8J0B


"Kathleen Day provides a panoramic and insightful analysis of financial booms and crashes that have shaped our nation’s history.  She demonstrates that loose credit and weak regulation have played key roles in promoting every speculative boom since the 1920s.  Her book is required reading for everyone who wants to understand how to prevent the next financial crisis."

Arthur E. Wilmarth, Jr., George 

Washington University Law School  


"An essential narrative of the regulatory cycles that predate financial crises, Broken Bargain offers an important lesson in the dangers of amnesia as Washington once again embarks on deregulation, repeating the mistakes of the past."

Sheila Bair, founding Chair of the Systemic Risk Council and former Chair of the FDIC


LISTEN to discussions about "Broken Bargain"

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Fraudster Charles Keating caused the biggest, costliest bank failure of the 1980s & helped set the stage for the mortgage crisis of 2007.  Hear podcast "Spectacular Failures" from American Public Media. http://bit.ly/2YJfFGl or  https://apple.co/2KqrzzH @FailureShow@oberandout


Podcast 

The 1819 Case that  Affirmed Hamilton's Genius on Federal Power

http://bit.ly/2UlQPOL


WASHINGTON HISTORY SEMINAR: 

I talk about my new book "Bankers, Bailouts, and the Struggle to Tame Wall Street," from Yale Press on the history of the federal government’s oversight of the financial sector, @CSPAN https://cs.pn/2GyxRNx 


Why we keep having financial crises: My interview with Federal News Network   http://bit.ly/2Gx2enr  via @FederalNewsNethttps


Capitalism is messy. Listen in as Daniel Peris (@Back2BizBook) has @KathleenDay on the #podcast to discuss BROKEN BARGAIN (@yalepress), her detailed, two-century history of the give and take between government authority and financial institutions. #ReadUP 

http://bit.ly/2ROm2ZKCapitalismIsMessy


With Top of Mind Host Julie Rose

BYU Radio

Why Financial Crises Keep Happening In America

http://bit.ly/2soizCQKDayJulieRose


ABC radio's Mark Remillard:

“Is corporate debt the next bubble?" I talked to @KathleenDay to find out: https://t.co/W8JoJaS1MX


With Host Janeane Bernstein, Southern California public radio, about Economic crashes and scandals http://bit.ly/2LVfaUO

The Historians podcast on the crazy history of banking and money in America

http://bit.ly/2KDayBankers


I talk with ABC radio's Mark Remillard about student debt and new Federal Reserve Board data showing how it's a drag on the economy. https://twitter.com/MarkJRemillard/status/1086053096290172928




WHAT'S the NEXT financial crisis?

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Yahoo Finance: Why an independent Fed is critical to the economy https://yhoo.it/2YwZzV8 via @YahooFinance


George Bailey call home: The Depression Era law that enabled the 1980s bank crisis--and scandal

http://bit.ly/2W0KXMB


Trump hands-off policies set stage for next  banking crisis

With colleague Martha Hamilton, our oped in The Hill

http://bit.ly/2VlphJE


Trump isn't the first White House resident to bully the Fed

https://nbcnews.to/2ZjcPZN


Baltimore Sun's Dan Rodricks on Wells Fargo’s continued existence given its many misdeeds:

http://bit.ly/2LhGUVy


Fox Business host wrongly claimed market crashed as 'instant reaction' to Obama’s 2008 election

http://bit.ly/2xeU6lA


Interesting questions about the Federal Reserve, its history, purpose and vulnerability to political pressure, with radio host Julie Rose on Top of the Mind @BYUTopofMind http://bit.ly/2YfW8gZ 


Rewarding Risk

Deposit insurance was meant to stop bank runs. But by generating unwarranted confidence in the banking system, it creates danger.

My piece for the American Historical Association

http://bit.ly/2Iarq48


What will the next financial crisis be? Read my latest....

http://blog.yalebooks.com/2019/02/19/troubling-signs-of-a-new-financial-crisis/


White House plan to cap federal student loans is questionable:  Will it just benefit banks and saddle borrowers with higher-cost debt.

http://abcradio.com/podcasts/start-here/


Fox Business host wrongly claimed market crashed as 'instant reaction' to Obama’s 2008 election

EVENTS

Event Details

Brookings' Panel: Future of bank supervision...

Or as I like to add "...or lack of it."

Friday Nov. 9th: Featuring keynote remarks by Randal Quarles, Federal Reserve Board's chief Wall Street Supervisor. Panelists include myself, Chris Brummer of Georgetown U., H. Rodgin Cohen of Sullivan & Cromwell, Randall Guynn of Davis, Polk 


Watch the recorded event https://www.brookings.edu/events/the-future-of-financial-regulation/


Coverage of the event https://dsnews.com/daily-dose/11-11-2018/the-future-of-financial-regulation

Politics & Prose Bookstore: Author's Talk

https://www.facebook.com/authorKathleenDay/photos/a.862071767517201/915624415495269/?type=3&theater


Despite the snow storm, a great crowd joined the conversation at @politicsprose on the history of American financial mayhem and what the current White House is doing to set the stage for the next debacle.

Sunday, January 13th, 2019

Author Talk: Broken Bargain

1 pm - 3 pm

5015 Connecticut Ave NW (202) 364-1919

Event Details

Sunday, January 13th, 2019

Author Talk: Broken Bargain

Bankers,  Bailouts and the struggle to tame Wall Street.

1 pm - 3 pm

5015 Connecticut Ave NW (202) 364-1919

Washington History Seminar: A talk on "Broken Bargain"

The Seminar series is a joint venture of the National History Center of the American Historical Association and the Woodrow Wilson International Center for Scholars. I gave a 45-minute talk and then took questions for that same amount of time

A recording of this event is available from C-Span: 

https://www.c-span.org/video/?457500-1/bankers-bailouts-struggle-tame-wall-street%E2%80%8B


Monday, February 4th, 2019

4 pm - 5:30 pm

The Woodrow Wilson Center

Downtown Washington DC

Monday February 4th, 2019

4 pm - 5:30 pm

The Woodrow Wilson Center, Downtown Washington DC

Monday February 4th, 2019

4 pm - 5:30 pm

The Woodrow Wilson Center, Downtown Washington DC

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