What we get wrong when we talk about ‘the financial crisis’

By Mike Konczal, Updated: September 14, 2013

This week is the five-year anniversary of the bankruptcy of Lehman Brothers. That’s being taken to mean it’s the five-year anniversary of the financial crisis.

Wrong. Or, at the least, terribly incomplete. The focus on Lehman obscures the fact that there were really three crises. Sure, there was the crisis in the financial markets in late 2008. But there was also the ongoing financial crisis that would have happened even if Lehman’s failure didn’t cause any troubles. Meanwhile, there’s still a crisis of confidence over whether or not our financial markets are actually benefiting the economy as a whole.

This isn’t just academic. Emphasizing Lehman biases the conversation over financial reform in a subtle but powerful way. The implication is that if Dodd-Frank can prevent the events of fall 2008 from happening, then our work here is done. That view is dangerously wrong.