Paul Krugman is a Princeton economist and an op-ed columnist for the NYT.

...Why, exactly, are banks special? Because history tells us that banking is and always has been subject to occasional destructive “panics,” which can wreak havoc with the economy as a whole. ... Gilded Age America — a land with minimal government and no Fed — was subject to panics roughly once every six years. And some of these panics inflicted major economic losses.

So what can be done? In the 1930s, after the mother of all banking panics, we arrived at a workable solution, involving both guarantees and oversight. On one side, the scope for panic was limited via government-backed deposit insurance; on the other, banks were subject to regulations intended to keep them from abusing the privileged status they derived from deposit insurance, which is in effect a government guarantee of their debts.....

This system gave us half a century of relative financial stability. Eventually, however, the lessons of history were forgotten. New forms of banking without government guarantees proliferated, while both conventional and newfangled banks were allowed to take on ever-greater risks. Sure enough, we eventually suffered the 21st-century version of a Gilded Age banking panic, with terrible consequences....

Ed Kilgore is a contributing writer to the Washington Monthly. He is is managing editor for The Democratic Strategist, a senior fellow at the Progressive Policy Institute, and a Special Correspondent for The New Republic.

One of the truly interesting things about the reaction to the president’s announcement of support for same-sex marriage (sorry if it annoys anyone that I’m writing about this yet again, but it is the dominant story of this week, affecting nearly every other political “story”), particularly among those who were pleased with it, is the constant alteration between narratives emphasizing its highly tactical and perhaps even accidental nature, and narratives placing it as extraordinarily important—even magnificent—from the perspective of history. This is particularly noticeable among LGBT writers, who often seem to pause in the midst of analyzing the event dispassionately or even cynically, to marvel at how it has affected them....

I’d observe that this isn’t the first, or second, time that a complicated progressive politician took a historic step in a calculated way from what might be at least partially interpreted as mixed motives. The Emancipation Proclamation, after all, contradicted years of prior statements by Lincoln that he never intended, even after the beginning of war, to tamper with slavery in its southern homeland. He got to his ultimate position in no small part, moreover, because he was convinced it would help win the war. But he also knew he was making history, and did.

Peter B. Doran is senior policy analyst at the Center for European Policy Analysis (CEPA) and P. Bracy Bersnak is assistant professor in the Department of Political Science and Economics at Christendom College.

These are rough days for the European Union (EU). What began as a sovereign debt crisis has now metastasized into a political debacle for the leaders left holding the bag. Nicolas Sarkozy's electoral defeat in France, the ouster of an austerity-minded government in Greece; and last month's collapse of the governing coalition in the Netherlands are all symptoms of a deeper problem for Europe: bloated governments are hard to tame, even when there is no money left to pay for them.

This is bad news for Europe. But the political tumult on the continent is also a stunning vindication of the post-War thinkers who anticipated this outcome. These individuals, men like Friedrich von Hayek and Wilhelm Röpke, would become founding intellectual fathers behind the modern conservative movement in Europe and the United States. Even today, their foresight provides a defining roadmap for navigating away from Europe's current crisis and offers a chilling warning to the United States about repeating the same mistakes.

Much like the debt crisis of our own time, the dimensions of Europe's post-War reconstruction were staggering. Only instead of ruined factories and decimated cities, today's contemporary European leaders must contend with bombed out credit ratings and the herculean task of reordering the continent's dysfunctional economies. Then, as now, the basic policy debate centered on the state's role as guarantor of public prosperity and welfare; and perhaps more importantly, how to finance it.

Garrett Epps is the legal affairs editor of The American Prospect. He is a former reporter for The Washington Post and a professor of law at the University of Baltimore. His most recent book is Democracy Reborn: The Fourteenth Amendment and the Fight for Equal Rights in Post-Civil War America.

Is anybody else as depressed as I am about the next four years? 

No matter who wins, we face the prospect of bitterly divided government, savage partisanship in Congress, and increasing executive desperation....

The Framers did not foresee the rise of a two-party system. As a result, the Constitution (unlike most twentieth-century constitutions) makes no provisions for party participation in government, or party accountability in policy. But their vision of disinterested, dispassionate demigods soberly debating the public good barely survived the Washington administration; the Founding generation itself descended into partisan warfare that compares in vitriol with what we face today. No amount of wishing will make party polarization go away—as Senator Richard Lugar learned this week. And amending the Constitution to tie parties more closely to responsibility would be a chancy and dangerous process....

Richard Cohen writes a weekly political column that appears on Tuesdays .

Barack Obama has read and been influenced by Robert A. Caro’s classic biography of Robert Moses, “The Power Broker.” From the evidence, it is far from clear, though, that the president has read Caro’s other books, the latest being the fourth installment of his massive Lyndon B. Johnson biography — “The Passage of Power.” He should immediately read it. It will teach him how to be president.

Maybe I should have written that it will teach him how to be a better president. Where Johnson was strong and unparalleled — personal relationships with much of Washington — Obama is frighteningly weak. Last week I asked a member of the Senate if he knows of anyone who really knows Obama. He said he does not.

Washington is thick with stories about Obama’s insularity and distance. We hear how he does not listen to criticism — he sometimes just walks out of the room — and how he sticks to a tight circle of friends. His usual weekly golf game is mostly limited to the same people — and when he played a round with House Speaker John Boehner(R-Ohio), it was treated as an exceptional event. When, for whatever reason, Politico analyzedObama’s golf outings (June 6, 2011), it found that Obama’s “golf circle has actually gotten much tighter over the past 2¹/ ₂years” — none of them politicians or, heaven forbid, journalists.

Lyndon Johnson, in contrast, would not think of wasting a golf game on the game itself…

Matthew Shaffer lives in Cambridge, Massachusetts.

When President Cristina Fernández de Kirchner initiated the nationalization and expropriation of the Argentine assets of YPF, an oil company owned mostly by Spanish interests, it came as no surprise to anyone who has visited the country recently or watched it closely. The theft, a consistent manifestation of the Kirchner personality and the mercurial character of the Argentine political class, was more a return to business as usual for the country than a shock — and goes a long way toward explaining why Argentina is poor.

In January 1912, an impartial observer of Argentina and the United States would have had trouble guessing which had a more promising future. Both enjoyed the low-hanging fruit of abundant, underpopulated land. The Argentine pampas were as fecund, tillable, and flat as the American Midwest. Argentina had a long coastline ideal for exporting the agricultural products that were grown inland. Immigrants from all over the world were rushing in. Argentina had one major advantage over the States: It had never relied so heavily on slavery for agriculture. So it had never experienced such a wrenching civil war, nor was it destined for the racial strife and inequality that would be the major blot on America’s future. By 1912, Argentina had even started to enjoy some soft power: The tango — which had originated in Buenos Aires’ slums — had just hit Paris and would soon be the rage in New York and Finland. The capital was marketing itself as a fully European city transplanted directly into the Americas.

In January 2012, I caught a flight to Buenos Aires with a cheap Air Canada ticket, a psychological desperation for more sunlight than Boston would enjoy until April, and a vague curiosity about why Argentina, which had once so resembled the United States, was now so different. What had happened in the intervening 100 years?...

If you want a one-word answer to the question “Why isn’t Argentina rich?” your best bet is coups. Between 1930 (when, only a year after Black Thursday, Argentina’s future may have looked even brighter than America’s) and 1976, Argentina endured at least six. Until 1930, its per capita GDP had closely tracked that of countries like New Zealand, Australia, and Canada. But constant political instability in the decades that followed threw Argentina off track. The reasons are basic: When a country is unstable, it is risky to make the long-term investments required for growth. When dictators and oligarchs use the economy to reward their friends and punish their enemies, markets can’t guide the structural evolution and modernization of the economy. Political revolutions leave a country economically retrograde. By 2000, Argentina’s per capita GDP was about a quarter of that of Canada, New Zealand, and Australia. It had largely missed the boat of the 20th century’s spectacular growth....