Source: EconLog
by Scott Sumner
“There has been a great deal of recent discussion of the problem of debanking. Most of what I’ve read seems to miss the root causes of the problem; debanking is a symptom of deeper problems with our system of governance. The problem cannot be fixed through ‘regulation,’ because the problem is caused by regulation. … Once you give regulators the power to shut down non-conforming banks, it is almost inevitable that ‘mission creep’ will set in and the regulations will become increasingly politicized. Whole classes of people become targeted. Certain ethnic groups associated with terrorism are viewed with suspicion. Americans living overseas are viewed as potential tax evaders, and often find it difficult to find a bank that will accept their deposits.” (12/03/24)