Whatever else it means, the current economic situation point out the reality behind the concept of moral hazard. Taking Wikipedia’s definition:

Moral hazard is the prospect that a party insulated from risk may behave differently from the way it would behave if it were fully exposed to the risk. Moral hazard arises because an individual or institution does not bear the full consequences of its actions, and therefore has a tendency to act less carefully than it otherwise would, leaving another party to bear some responsibility for the consequences of those actions. For example, an individual with insurance against automobile theft may be less vigilant about locking his or her car, because the negative consequences of automobile theft are (partially) borne by the insurance company.

one wonders why this concept that is widely used in economics is not recognized as even more significant in human society, in general. Hence, religion.

Speaking of which, Daniel Henninger writes in the Wall Street Journal about Old-Time Religion:

Responsibility! Accountability! Discipline! Oversight! Rules!

The canyons of Wall Street are ringing with Democratic politicians and liberal pundits crying out for the renewal of ancient values and a return to basics. The political right wants market failures to be punished with Old Testament ruin.

The financial crisis has brought calls for a return of ethics, standards and rules — and not just on Wall Street. Dan Henninger tells Kelsey Hubbard how these themes are affecting the campaign trail. (Sept. 25)

So we’re all agreed: Standards of behavior matter.

All that remains is to see if this week’s left-right consensus on standards can be extended to any corner of American life beyond “CEO pay” and other sitting ducks….