This morning, Treasury Secretary Hank Paulson unveiled the long-awaited financial regulatory reform proposal of the President's Working Group on Financial Markets, which he heads. President Bush and Secretary Paulson are to be commended for the breadth of this proposal and for its principled and thoughtful approach. Admittedly, the proposal won't do much for the immediate financial crisis, but it would avert some future crises.

Replacing our hodgepodge of overlapping and ineffective financial regulation with a comprehensive, sensible, and lower cost system makes all the sense in the world. Many in the financial markets support these reforms.

The New York Times has a front page story today about how Washington is considering some type of legislation that will increase the regulatory oversight on financial services firms much like how, in the wake of the Enron and Wolrdcom collapses, Sarbanes-Oxley changed how accounting firms and corporations could operate.

The fact that there are few specifics in the good story by Ed Andrews and Steve Labaton about what the increased regulations might be isn't surprising.  The discussions among policymakers are only a few weeks old and, as the story points out, really only got some momentum a week or so ago when the Federal Reserve began to take actions that could be called a Wall Street bailout.