Financial Reform Bill

In today's WSJ, Niall Ferguson and Ted Forstmann make a very good point about new financial regulation:

The case for limiting leverage and regulating derivatives is overwhelming, but that doesn't require a new 1,300-page law.

This is a good example of how, theoretically, government can make things better, but in practice, they don't. Of course, a theory that applied the same selfish motives and asymmetric information to government agents would not predict government will probably make things better merely because they could (eg, public choice theory). But, most economists opining on policy just figure, 'I can make it better, ergo, the government should be given power to make it better'. Useful idiot-savants are they.