I’m not referring to Wall Street payouts, but to how society tends to respond to problems.

Case in point: a laxity of regulation has resulted in a rush to over-regulate. Wall Street, Fannie Mae and Freddie Mac sounded the alarm and now Washington pours water on a fire already out. The current trend is not regulation but a push for control.

Emotionalism, irrationalism and just plain “cover your buttism” causes individuals and organizations to overcompensate. By responding “in a big way” (i.e. overcompensating), a strong message is sent. While the message may be strong, the outcome is a swing the opposite direction that misses the rational and desirable middle (or golden mean as Aristotle referred to it).

When you overcompensate in steering your car, you often spin, skid or wreck. Watch for similar results in the economy.