Ineffectiveness

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Recommended: What are the effects of deregulation on the nation economy

Banks exist all over the world and are usually heavily regulated by the government in order to prevent corruption and to protect the money of the general public. The banking industry is an enormous sector of business and finance that has existed for thousands of years. The banking industry plays a large part in financial dealing and a popular means for investing, borrowing and sorting money. Deregulation is one of the solutions to the problem of corruption in the banking industry but it has not proven to be that effective.
Corruption is defined as the misuse of entrusted power for private gain such as embezzlement and other white collar crimes. The banking industry has had a lot of rises and falls throughout the years. According to the article by Ron Paul (2010), the Framers were the founders of the first bank and wanted to create an institution modeled after the Bank of England (Paul, 2010, pp. 465-467). The Bank of North America was given a monopoly privilege and no other bank were permitted to operate in the country. Thomas Jefferson understood this banking system as a system of organized corruption in order to expand the size and scope of the state beyond what the Constitution would allow (Dilorenzo, 2011, p. 79). Needless to say, the central banking system was short lived in the United States because many Americans at this particular time in history were very suspicious of central banks, sensing them as a source of official corruption.
Bank deregulation has to be one of the biggest events in the banking industry history. Deregulation is defined as the reduction of elimination of the government in a particular industry. Toe Koechilin in his article (2013) described deregulation as the “paring back of corporate ac...

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... with a little bit of government regulation. Banks are said to be too big to fail but in reality banks are too big to jail. Until there is some government interference in the banking industry, the banking industry can do no wrong.

Works Cited

Baradaran, M. (2013). How the Poor Got Cut Out of Banking. Emory Law Journal, 62(3), 483-548.
Beck, T., Levine, R., & Levkov, A. (2010). Big Bad Banks? The Winners and Losers from Bank Deregulation in the United States. Journal of Finance, 65(5), 1637-1667. doi:10.1111/j.1540-6261.2010.01589.x
Dilorenzo, T. J. (2011). A Note on the Machiavellian Orgins of Central Banking in America. Quaterly Journal of Austrian Economics, 14(1), 78-87.
Koechilin, T. (2013). The Rich Get Richer. Challenge(05775132), 56(2), 5-30.
Paul, R. (2010). The Banks Versus the Constitution. Harvard Journal of Law and Public policy, 33(2), 465-473.

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