When does Wall Street get capped?

The Hill reported this morning that:

Rep. Paul Ryan (Wis.) and Sen. Judd Gregg (N.H.), the senior Republicans on the House and Senate Budget committees have praised a proposal by the fiscal panel’s Democratic co-chairman, Erskine Bowles, to limit government spending and revenue to 21 percent of gross domestic product.

As Dean Baker has written:

Most serious policy analysts believe that government should provide services that it does more efficiently than the private sector (e.g. defense), while leaving services it does less efficiently to the private sector. However Mr. Bowles apparently thinks that the government should instead adhere strictly to his magical 21 percent number. This means that Mr. Bowles would insist that the private sector provides services, even if it can be shown that the public sector is more efficient, because of his reverence for the number 21. In other words, Bowles is apparently prepared to slow growth and cost workers jobs out of his devotion to the number 21.

Actually, I'd love to see the financial sector get similarly capped. Oh wait, but that would run afoul of our trade agreements, which state:

In sectors where market-access commitments are undertaken, the measures which a Member shall not maintain or adopt either on the basis of a regional subdivision or on the basis of its entire territory, unless otherwise specified in its Schedule, are defined as:

(a)        limitations on the number of service suppliers whether in the form of numerical quotas, monopolies, exclusive service suppliers or the requirements of an economic needs test;

(b)        limitations on the total value of service transactions or assets in the form of numerical quotas or the requirement of an economic needs test;

(c)        limitations on the total number of service operations or on the total quantity of service output expressed in terms of designated numerical units in the form of quotas or the requirement of an economic needs test...

Unlike some policies that propose to constrain the size of the the financial sector or individual financial institutions (like a firewall between investment and commercial banks), a 21 percent cap on any service sector would be more likely to meet the GATS' definition of being "in the form of a numerical quota."

If government services were per se bound to GATS, the Bowles proposal would almost assuredly be ruled a GATS violation. They're not, but financial services definitely are. Yet another way that neoliberals selectively apply their ideology in the service of corporate welfare.