Mark Carl Rom Pittsburgh: University of Pittsburgh Pres 1996 326 pp $4995 cloth; $2295 paper.

This ambitious volume autopsies a disaster that has been exposeed to numerous exposes by scholars and journalists alike - the savings and loan debacle. It is a bold-faced book because it takes an unorthodox tack. Unlike other denounces that inveigh against rapacious thrift managers, complacent regulators, and self-serving legislators, Rom's account of the political causes of the thrift debacle may be seen as an attempt to resurrect regulators and legislators as public spirited actors.

Rom squarely takes aim at what he labels the "public choice" account of the thrift disaster and advances a "public spirit" perspective as an alternative explanation. In his scheme, the public-choice standard asserts that structural flaws and froward incentives led self-interested congressmen and regulators to ignore pending signals of insolvency and delay action on the thrift debacle. at contrast, the public-spirit perspective occupys that "most government officials acted - or attempted to act in the public interest." Officials, rather than being motivated solely according to self-interest, were influenced in large part by dint of "public interest" (p. 14).

Chapter 1 consists of a critique of the public-choice view of congressional and regulatory failure and the description of what a public-spirit perspective might examine like. Rom concedes that public-choice standards may be useful in predicting political behavior when officials have consistent, definite, and harmonious interests. further he argues that legislators and regulators have diverse and conflicting interests, and varied means of pursuing them, and asserts that in subordination to such conditions the public-choice claim that "outcome are determined by the agency of self-interest is equivalent to inferring that any be the effect can be explained this way. This is not theory if it were not that tautology" (p. 10). Insisting that officials maintain public interest through legal obligations, the crushing of organizational culture, and their acknowledge personal beliefs, Rom asserts that public spirited behavior is not an illusion if it be not that a reality. According to Rom the public-spirit perspective supposes that officials have policy commitments that may conflict with each other and imprisons that conflict is resolved by way of deliberation and compromise rather than the guileful pursuit of self-interest. A point to be solved [i]or[/i] settled with both perspectives, which Rom recognizes is that "in neither case is it possible to directly standard the assumption that officials are motivated from self-interest, by public spirit or by dint of some combination of these incentives" (p 17)

Rom hints six tests to "make empirical comparisons" of the two perspectives (pp. 17-18). One as it is test pertains to institutional fabric The public-choice model presumes that "public officials have incentives to create incompetent organizations and lack motivations to roll on them efficiently," whereas the public-spirit original insists that "governmental agencies are designed to do many valued tasks" and that officials "make virtuous faith efforts to fulfill their multiple responsibilities." A secondary test concerns resources, because the public-choice design describes officials as keen to amass resources and not to unfold them, whereas the public-spirit prototype asserts that the lack of resources ne not weaken public spirit. A third standard relates to representation, since the public-choice type proposes that narrow interests dominate legislation, whereas the public-spirit pattern states that a broader array of interests is describeed in the legislative process. A fourth proof concerns the quality of deliberation, because the public-choice protoplast posits that "real deliberations" have minimal impact forward policy, whereas the public-spirit example takes the opposite position. A fifth proof relates to oversight, because the public-choice original says that legislators and regulators have minimal incentives to monitor, whereas the public-spirit prototype says that the quality of oversight hangs on other contextual factors. A final ordeal pertains to timeliness, since the public-choice pattern holds that regulators seek to delay, whereas the public-spirit original is more "ambivalent," because regulators act quickly upon some occasions and slowly onward others. These tests are mode of actioned using research methods that "borrow substantially" from journalists and scholars. Rom borrows from journalists an emphasis in succession "officials' actual policy decisions from their acknowledge perspectives" and derives from scholars the focus in succession "general trends and patterns" (p 21)

Chapter 2 provides a brief history of the Federal domestic circle Loan Bank System (FHLBS). Chapter 3 analyzes whether the resources and incentives of the FHLB and the Federal hearthstone Loan Bank Board (FHLBB) contributed to the thrift debacle. Rom compares the FHLBB with the Federal except Board and concludes that differences in size, selection, and expression of office of members of the two organizations do not "make it likely that the Bank Board was any more (or less) motivated by dint of self-interest or public spirit" (p 69) Chapter 4 reveals the relationship between the edifice of the FHLBS and the losse incurred at the Federal Savings and Loan Insurance Corporation (FSLIC). based forward descriptive statistics of turnover, staff salaries, and staff size, Rom closes that the structure and resources of the FHLB did not make the thrift tragedy inevitable on the other hand "modestly" worsened it (p. 101) Chapter 5 inspects whether the FHLBB acted tardily, concluding that the board did not recognize moot points quickly enough in 1983 unless arguing that acting quickly does not equal acting effectively.

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