Public Spirit in the Thrift Tragedy

This book reviews the fascinating-and horrifying-story of how American savings and loan associations (also known as 'thrifts') managed to rack up horrendous losses during the decade of the 1980s. . . . Rom tells the story with great skill, and it was a pleasure for me to watch the details of the unfolding of a financial Greek tragedy.
Annals of the American Academy of Political and Social Science
Winner of the 1996 Harold Lasswell Award

Winner of the Harold Lasswell Award of the American Political Science AssociationThe FSFIC failed spectacularly during the 1980s, costing taxpayers an estimated $200 billion. In this award-winning analysis, Rom examines the political causes of this “thrift tragedy.” He directly confronts-and rejects-the dominant scholarly “public choice” view that public officials were motivated mainly be self-interest. Instead, Rom argues that politicians and bureaucrats generally acted in the “public spirit” by attempting to obtain the common interest as they saw it. Using new evidence and innovative methods, Rom demonstrates that FSLIC's failure unfolded because of commitments that officials had made in the past and their uncertainties about how to fulfill these obligations in the future.

326 Pages, 6 x 9 in.

May, 1996

isbn : 9780822956006

about the author

Mark Carl Rom

Mark Carl Rom is associate professor of government at Georgetown University.

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Mark Carl Rom