"...let's please have a serious discussion about the nature of the banking system structure itself: its complexity, its responsibility, and the proper role of the federal government in regulating it. "

Serious discussions about the financial/banking crisis have certainly been taking place, at least for the past 2 or 3 months, and continue today.

Because of the gravity and imminence of the problem, policy makers probably felt that time was of the essence regarding proffering some "solution." Proposing something, and proposing it right now, was the preferred choice; to stay mute--which both the Fed and the Administration did for 2 years as the nation's housing market collapsed--was an untenable alternative.

Paulson's proposals reek of scrambling. They are unlikely to be adopted as is, and Paulson knew that. But they do provide a starting point for the debate to come; and they are an indication to both the public and to the financial/banking community that big change is coming.

Without being overly hyperbolic, Capitalism is facing its most significant crisis since the 1930's. And, like then, it will emerge triumphant, but fundamentally different.

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