A manageable size
SIR – I read your leader on financial companies that are “too big to fail”, and your statement that “on the left, some want banks cut down to size” (“In praise of Doddery”, March 20th). Many on the left would be surprised, then, to find themselves thinking along the same lines as Adam Smith. In “The Wealth of Nations”, he called for free competition: “By dividing the whole circulation into a greater number of parts, the failure of any one company, an accident which, in the course of things, must sometimes happen, becomes of less consequence to the public. This competition, too, obliges all bankers to be more liberal in their dealings with their customers, lest their rivals should carry them away.”
Controlling size in any industry is neither left nor right, but appropriate. Too big to fail is too big to manage as well as too big to regulate, as recent events have demonstrated all too clearly.
Professor Michael Mainelli