With the crises of the 1980s, the issues of moral hazard—resulting from the federal safety net and the resulting need for better market discipline—came to the fore. After the financial crisis of 2008, the emphasis has shifted to financial innovation and nonbank financial providers, followed by debate as to the causes of the recent crisis and the reforms needed to prevent such a disaster from recurring. There is concern that new regulations could impose onerous costs on banks and our economy, stifling financial innovation and economic growth. On the other hand, there is genuine alarm about the immense scale and seemingly indiscriminate nature of the government assistance provided to large banks and nonbank financial companies during the crisis, and what effects these actions will have on bank competition. Remarks by FDIC Chairman Sheila C. Bair on May 5, 2011, before the 47th Annual Conference on Bank Structure and Competition sponsored by the Federal Reserve Bank of Chicago.
Last Updated: November 17, 2025