There's an engineering principle, if you address a complex problem (or any problem) with a complex system, it's going to be buggy. Addressing complex social issues with complex legislation (Dodd-Frank, Sarbox, etc.) results in loopholes (bugs). Many lawmakers surely realize this, but their main goal is re-election, and doing something (the equivalent of Dilbert moving his mouse around) gives the media something to report, which in turn keeps the lawmakers' names in front of the public and feeds the perception of positive action.
The equivalent of engineers are the staff lawyers who actually write the legislation, and cycle between government and industry positions, much like contract programmers; but in their case they get rewarded for the bugs they write in their code by advising industry clients on how to exploit them. (That of course is a simplification. Goldman is using lawyers experienced in parsing complex security laws, not necessarily the same ones who wrote the laws.)
I'm not sure. They're lawyers, not engineers, and I don't see any reason for lawyers to conclude "It's fundamentally complex, impossible to get right, and going to have problems" rather than "Well, they just didn't try hard enough to make a good law". And certainly the belief that they can create a solid law through sheer staggering complexity rather than despite sheer staggering complexity is a more parsimonious explanation of what has been happening lately than the idea that they know that simpler laws are better.
There are few enough computer programmers who figure this out even with the math staring them in the face and great engineers all but spoonfeeding these tidbits of wisdom; I can't imagine this is anything like the common perception of law in lawmaker circles, and especially not in circles where people believe activist government is on average the solution to everything.
If there's even a debate about having a law, it's because there's a real or perceived failure by the market to do the right thing. In this case, it'd be because Goldman's activities have nothing to do with the proper role of finance and everything to do with exploiting the already existing bugs in the market system.
Nobody's saying that the government should write laws regarding toilet paper manufacturing, for example. There's a difference between "make a working complex system even more complex", and "attempt to fix a completely broken system, with full knowledge that your fix won't be perfect either".
>They're lawyers, not engineers, and I don't see any reason for lawyers to conclude "It's fundamentally complex, impossible to get right, and going to have problems"
Very true, my brother who, is the press secretary for a relatively prominent senator, said to me when we were debating the health care bill, "Complex problems have complex solutions." and then... "Getting to the moon was a complex problem, and I'm sure it took lot more than 2000 pages to explain the process of getting there."
> "Getting to the moon was a complex problem, and I'm sure it took lot more than 2000 pages to explain the process of getting there."
Yes, but how many of those pages were written by congressional staffers?
> "Complex problems have complex solutions."
Not necessarily. Besides, the question is not whether the solution is complex, it's whether the proposal is a solution. The fact that a proposal is complex doesn't tell us whether it is a solution.
Funny, I can write the exact opposite of your point with that same argument.
A lot of engineers dealing with highly complex problems know that things are more intricate than they appear on the surface. (Compare the BP oil well disaster to a cut firehose, seemingly analogous, but almost every solution to the second will not work on the first) Often the elegant solution that works in theory fails in practice, and requires several iterations adding subsystems to deal with small problems that crop up in testing.
Politicians that see only in black and white really ignore these inconvient details while they espose rhetoric and focus on reelection. Their simplistic and naive view of the world doesn't allow them to tackle the hard problems that take nuance and balancing benefit against unintended side effects.
> Many lawmakers surely realize this, but their main goal is re-election, and doing something (the equivalent of Dilbert moving his mouse around) gives the media something to report, which in turn keeps the lawmakers' names in front of the public and feeds the perception of positive action.
You're assuming that they would "do good" if not for the pressures of re-election.
The equivalent of engineers are the staff lawyers who actually write the legislation, and cycle between government and industry positions, much like contract programmers; but in their case they get rewarded for the bugs they write in their code by advising industry clients on how to exploit them. (That of course is a simplification. Goldman is using lawyers experienced in parsing complex security laws, not necessarily the same ones who wrote the laws.)