Although a bipartisan agreement will be hard to achieve in the current Washington environment, both parties should recognise that a package of entitlement reforms is less dangerous than an explosion of US interest rates in the coming years.

Reviewed by Jim McTague. Here’s an idea for curbing the rapine of all those financial executives thumbing their noses at the taxpayers who rescued them from ruin: Limit their annual salaries to $300,000 to $400,000, and institute three-year performance programs that award bonuses to good stewards, but not the bad.

That’s just one of several provocative ideas found in this thorough, intelligent and straightforward book by money manager Robert Pozen, which traces the ontogeny of the financial crisis and offers ..read more

CONGRESS RAISED the federal debt limit this month by $1.9 trillion to a record level of $14.3 trillion. Given the projected budget deficit for the next year, the gross public debt of the US government will probably hit that $14.3 trillion limit by the end of 2010. This huge expansion of public debt is not just an abstract concern of economists; it is likely to hurt the practical situation of most American families and firms.

A special report on financial risk. Robert Pozen … thinks bank boards would be more effective with fewer but more committed members. Cutting their size to 4-8, rather than the 10-18 typical now, would foster more personal responsibility. More financial-services expertise would help too. After the passage of the Sarbanes-Oxley act in 2002 banks hired more independent directors, many of whom lacked relevant experience. The former spymaster on Citi’s board and the theatrical impresario on Lehman’s may have been ..read more

By John Plender. After two and a half years of relentless financial pounding, the crisis literature is becoming mountainous. To command the weary reviewer’s attention, any new book on the aberrations of the financial community has to have a clear focus and make a compelling case. In Too Big To Save? Robert Pozen, chairman of mutual fund group MFS Investment Management and a former vice-chairman of Fidelity Investments, pulls off the trick.