Fed governor Jerome Powell, in remarks prepared for a conference of community bankers in New York, said banks under a certain asset level, “perhaps $10 billion,” should be exempt from Dodd-Frank compensation restrictions. The restrictions, which are being developed by the Fed and other agencies, are designed to remove encouragements for bankers to take excessive risk.

Couple things about this. Why $10 billion? Why not $20 billion? Why not $5 billion? Based on what logic is this limit chosen? Based on what logic is any limit chosen? How is “system risk” from bank failure, the putative rationale for Dodd-Frank at all, a lesser risk than government’s intervention into the market place?

The other thing is “excessive risk.” Based on what criteria? What constitutes “excessive?” Under what circumstance is risk excessive here, but not there? What about government’s excessive risk from the bailouts and “stimulus” package of the 2008-2009 period; risks from which our economy still has not recovered?

How is government—politicians and bureaucrats—better qualified to determine what is excessive than the businessmen and shareholders and investors involved? How are those politicians’ and bureaucrats’ solutions to actual business failure and economic dislocation better than the folks involved—including in the aggregate, the collected citizenry? We still haven’t recovered from those government men’s last set of solutions.