Bailout Ushers In New Era of Regulation

When the dust settles on the $700-billion federal bailout, one thing will be clear, the Wall Street Journal writes: that it signals a swing toward government intervention in the business world not seen since the 1980s. Treasury becoming a shareholder in firms it lends to, regulation of credit-default swaps, limits to compensation of executive whose companies require rescuing—all are being taken seriously as the "hands-off approach to business that's dominated Washington for decades" has been fatally undermined by economic turmoil.

David Brooks, writing about the same shift in the New York Times, calls it "progressive corporatism." After two liberal decades followed by two conservative ones, we're moving toward a centrist stance that will satisfy neither extreme, he says. "We’re entering an era of the educated establishment, in which government acts to create a stable—and often oligarchic—framework for capitalist endeavor.