The great American banking snafu.

The Great American Banking Snafu.

The Great American Banking Snafu. Mary L. King. Lexington, $16.95. Imagine a football team with five head coaches and 50 assistants, "all with different game plans and different regulations, which confused the field officials who often were overruled by officials sitting on the bench. Also, while one coach would be calling a time-out, another would be telling the team to go for a field goal.' This is Mary King's harrowing vision of the American banking system.

King, a professor of marketing and management, blames misplaced, misguided regulation for most of our banking problems in this often-colorful survey of American banking history. While bankers themselves have contributed to the confusion, King accuses politicians of making the worst blunders. They have overregulated interstate banking and squelched healthy competition among different kinds of financial institutions, says King, while letting slide the risky investments that underlie the recent rash of bank failures.

Her prescriptions are sweeping: uniform national standards and regulation for financial institutions, legalized interstate banking, FDIC protection for both state and federal banks, disclosure of all banking operations, and incentives to increase cooperation among banks.

As a stark contrast to our own sorry mess is the inspiring example of Sweden's banking system, says King. It isn't clear, however, why she chose the Swedes as models; she concedes that much of their success is due to "unintended consequences prevail[ing] over planning,' as well as a political system lacking our fractious tradition of federalism. Despite this somewhat forced comparison, King's book is a thorough and lively overview of American banking.