To the Editor:
Ezra Klein is right in his commentary, “Three Ways the Financial World Has Gone Topsy-Turvy” (column, March 19): There are no truly private banks whose viability is not a public concern, in that there are no banks, even small ones, whose failures won’t affect ordinary people.
Even a small regional bank might hold the uninsured (more than $250,000) deposits of a family who just sold their home and plan to shop for a new one, a small business sitting on receipts that will soon be used to pay off its suppliers, or (as with Silicon Valley Bank) a payroll processing company about to issue paychecks to other companies’ employees.
If the government is going to insure deposits, setting a cutoff of an arbitrary sum like $250,000 does not limit the consequences of failures to the reckless, the heedless or the super rich.
Which is why, when bank failures loom, these limits seem practically unenforceable.
Tim Nesbitt
Independence, Ore.
To the Editor:
Re “Partisan Bickering Could Endanger America’s Banking System,” by Jay Clayton and Gary Cohn (Opinion guest essay, March 18):
I nearly fell out of my chair when I read the writers’ claim that “by and large, we have done a good job” at regulating banks. From the Great Depression to the savings and loan crisis to the Great Recession to today’s Silicon Valley Bank and Signature Bank failures, America has not done a great job of regulating banks.
Regulatory lapses in banking are not outliers but the norm, and, frankly, we shouldn’t be surprised. No industry in the United States holds as much power and influence over the regulatory process as the finance and lending industry. As the largest contributor to political campaigns, the finance industry buys itself a favorable legislative environment.
The revolving door that connects regulators and private lenders ensures a favorable regulatory environment. And the privileged institutional position of private banks on the boards of Federal Reserve Banks guarantees a favorable supervisory environment.
We need to reduce the political power of this privileged industrial class and promote alternatives that put citizens and communities ahead of shareholder profits.
Mark K. Cassell
Kent, Ohio
The writer is a professor of political science at Kent State University and has written books about banking and financial crises.
To the Editor:
Jay Clayton and Gary Cohn claim that requiring stress tests and capital controls on small and medium banks like Silicon Valley Bank would be too onerous, but Silicon Valley Bank had over $200 billion in assets. These are not mom-and-pop banks like in “It’s a Wonderful Life,” with the savings of friendly local shopkeepers and average American homeowners with mortgages.
Failure to better regulate these banks, and then bailing out depositors with more than $250,000 in assets, creates moral hazard, pure and simple (heads they win, tails taxpayer loses). The solution is to require more robust capital controls and regular stress tests, as bank size gets larger.
Michael Schwartz
Mercer Island, Wash.
To the Editor:
Re “How to Make This the Last Banking Bailout” (editorial, March 15):
Here we go again. Bank failures and the inevitable finger-pointing and blame game. The editorial does not address the problem of bank runs, which can cause banks to rapidly fail.
Let’s put the needs of depositors and keeping the economy running ahead of concerns about moral hazard and bailouts. We should not expect depositors to be better credit analysts than regulators in evaluating their bank’s balance sheet.
F.D.I.C. insurance of deposits up to $250,000 is fine for individuals like me or companies with a handful of employees, but is inadequate for small and large corporations that must keep hundreds of thousands or millions in uninsured accounts. F.D.I.C. insurance coverage needs to be increased to realistic levels, along with smarter regulation.
Alan Barkin
Menlo Park, Calif.
An Earlier D.A.’s Efforts to Prosecute Trump
To the Editor:
Re “Before His Death, I Asked the Manhattan D.A. What His Greatest Fear Was. He Answered: ‘Trump,’” by Andrew Meier (Opinion guest essay, nytimes.com, March 20):
In Mr. Meier’s essay on the relationship between Robert Morgenthau and Donald Trump, he writes of the efforts to find criminal wrongdoing in the Trump Organization: “Cyrus Vance, the Manhattan D.A. from 2010 to 2022, spent more than three years and untold millions — some of it taxpayers’ money — trying and came up short.”
In fact, Mr. Vance put the taxpayers’ money to good use. His prosecutors discovered a significant tax fraud perpetrated by the Trump Organization: It paid top executives off the books by lavishing them with luxury cars, apartments and tuition for their progeny to attend elite private schools.
Mr. Vance indicted the organization, which was later tried and convicted under his successor, Alvin Bragg.
Beyond that, Mr. Vance’s prosecutors were investigating whether Mr. Trump and his organization had perpetrated a huge loan fraud against Deutsche Bank, obtaining hundreds of millions from the bank by submitting loan applications on which the value of Mr. Trump’s and his organization’s assets were grossly overinflated.
His prosecutors were in the process of presenting evidence to the grand jury when Mr. Bragg took office and, for reasons best known to him, shut down the prosecution. Accordingly, Mr. Meier’s implicit criticism of Mr. Vance is entirely unwarranted.
Elliott B. Jacobson
Scarsdale, N.Y.
The writer is a former assistant district attorney in Manhattan and assistant U.S. attorney for the Southern District of New York.
Gawk Like a Tourist (and That’s a Good Thing)
To the Editor:
Re “How Can I Avoid Looking Like a Tourist in New York?” (Here to Help, March 20):
Usually I delight in Vanessa Friedman’s excellent writing and savvy insights. However, I must take exception to her promotion of striding “fast, with purpose” through an unfamiliar city so as not to look like a tourist.
Gawking, lingering and pointing have provided me with the most satisfying pleasures from touring in Cardiff, in Buenos Aires, in Sydney and cities in between. One’s obvious curiosity and awed confusion invite natives to set one straight. Perhaps a New Yorker might slow down and ask, “Whatcha looking at?”
Among my most memorable gawks was one that led to an invitation to tour a 19th-century mansion in Worcester, Mass. From the owner I received a history lesson, a book and two cartons of homemade ice cream for the road.
Here’s to wearing a tourist persona!
Jane Maynard
Portland, Ore.
Fund Our Public Libraries
To the Editor:
Thank you for “Even Amid Deficits, Libraries Are Priceless,” by Michael Kimmelman (Critic’s Notebook, March 13). Mayor Eric Adams proposes funding cuts for libraries, as well as for other New York City departments. These cuts must be rejected.
Mr. Kimmelman describes three new libraries in New York City, and they are a cause for joy. The hours I have spent in libraries as a reader, student, part-time employee at Hunter College and teacher have enriched my world more than I can convey.
As he states so simply: “It’s a question of recognizing value.” Andrew Carnegie understood that value when he gave this city public libraries, one of its greatest gifts.
Read what Mr. Kimmelman wrote, Mr. Mayor!
Nydia Leaf
New York