The Harvard Business Review’s January-February issue presents a provocative idea: the financial sector should use a "military approach" to keeping the economy safe. 

Lawrence M. Candell, the assistant head of the aerospace division at MIT Lincoln Laboratory in Lexington, Massachusetts, writes that a federally funded R&D center could borrow "the best practices of defense research centers, designing, analyzing, prototyping, and troubleshooting financial innovations, making sure they promoted our economic security and prosperity."

“That would mean hiring top talent from a wide range of disciplines in both academia and industry in order to provide a high-level systems perspective on problems ... And it would mean transferring lessons learned to the industrial base, in part by establishing requirements for novel financial instruments and providing guidance to financial regulators.” 

It's all well and good to consult the best and brightest on how to protect the economy. But does the government really need to be in the business of designing financial innovation? And isn't providing "high-level systems perspective on problems" what regulators are supposed to do?

Candell's implied analogy between defense and finance is questionable. The government and the nation's financial services firms aren't developing weapons against a common foreign threat. 

The laboratories where his "rapid prototypes" would be built exist right now, at these firms. They don't require research grants because they're self-funding.

And the only way to hire top talent is to offer more money than Wall Street does - a tall order.

But some of the money Candell is proposing be raised could be used instead to expand the ranks of regulators and pay them a more competitive salary.

BankThink is a collective byline used by American Banker editors to make observations and weigh in on big ideas shaping the industry.