Simon Johnson, the former chief economist at the International Monetary Fund, is the co-author of “13 Bankers.”

The idea that big banks damage the broader economy has considerable resonance on the intellectual right. Thomas Hoenig, the recently retired president of the Federal Reserve Bank of Kansas City, has been our clearest official voice on this topic. And Eugene Fama, father of the efficient markets view of finance, said on CNBC last year that having banks that are “too big to fail” is “perverting activities and incentives” in financial markets — giving big financial firms “a license to increase risk; where the taxpayers will bear the downside and firms will bear the upside.”

Today’s Economist

Perspectives from expert contributors.

The mainstream political right, however, has been reluctant to take on the issue. This changed on Wednesday, with a very clear statement by Jon Huntsman in The Wall Street Journal on regulatory capture and its consequences. Before the 2008 financial crisis, he wrote, “the largest banks were pushing hard to take more risk at taxpayers’ expense.” And now, he added:

More than three years after the crisis and the accompanying bailouts, the six largest American financial institutions are significantly bigger than they were before the crisis, having been encouraged to snap up Bear Stearns and other competitors at bargain prices. These banks now have assets worth over 66 percent of gross domestic product — at least $9.4 trillion, up from 20 percent of G.D.P. in the 1990s. There is no evidence that institutions of this size add sufficient value to offset the systemic risk they pose.

This message could work politically, for five reasons.

First, for anyone on the right of the political spectrum who thinks at all about the issues, this is a coherent and appealing position. Mr. Fama had it exactly right when he said, in the same interview that “too big to fail” “is not capitalism; capitalism says — you perform poorly, you fail.”

“Too big to fail” is not a market-based concept; it’s a government subsidy scheme — of the most inefficient and dangerous kind.

This is exactly Mr. Huntsman’s theme: “Hedge funds and private equity funds go out of business all the time when they make big mistakes, to the notice of few, because they are not too big to fail. There is no reason why banks cannot live with the same reality.”

Second, serious senior figures within the Republican Party have long been pointing in this direction. In 2009, for example, former Treasury Secretary Nicholas Brady said, “First we should just come out and say it: the financial system that led us to the brink of disaster is broken.” And former Secretary of State George P. Shultz has emphasized that we should “make failure tolerable,” suggesting, for example, “an escalating schedule could be required of necessary capital ratios geared to size and matched with escalating limits on leverage.”

Republicans like to discuss who is and is not a true Republican. How can any true Republican condone the subsidies that underpin our biggest financial companies today?

Third, mainstream financial thinking is in exactly the same place, in terms of asserting that capital requirements for big banks should be much higher. On this issue I refer you, as always, to the work of Anat Admati and her colleagues at Stanford University.

Mr. Huntsman’s position is in alignment with the strongest possible technical thinking, but he has also found a direct and easy way to communicate the right political message. Higher capital requirements for big banks are a great idea; they should help prevent financial disaster. But when such disaster occurs, we need financial institutions that can actually fail — with losses to creditors — without bringing down the entire system. Anything “too big to fail” is simply too big.

Fourth, political Republicans who favor the status quo with regard to megabanks are going to have a hard time justifying that position — including in a confrontational debate format. (Mr. Huntsman declined to participate in this week’s debate among the Republican candidates, but is likely to spread his “too big to fail” message as he campaigns at town hall meetings in New Hampshire.)

In particular, Mitt Romney is very vulnerable on this issue, as he has already lined up so much support from among the biggest banks. Presumably the prospect of Wall Street donations is enough to deter some Republicans (and many Democrats) from confronting the issue of “too big to fail.” But if Mr. Romney is already far ahead is this fund-raising category, there is much less to lose. And his donations must make it harder for him to explain exactly how he would ensure that even one megabank could fail.

It’s not enough just to wish that big banks could fail or to promise not to support them next time. This is not a credible commitment — and the “resolution authority” created under the Dodd-Frank regulatory legislation is a paper tiger with regard to winding down the biggest banks. If the choice is global economic calamity or unsavory bailout, which would you — let alone any Republican president — choose?

Mr. Huntsman has joined the dots. There are various ways to directly address and remove the implicit subsidies that the largest banks receive. Bloated size and excessive leverage can be effectively taxed. As he said:

Eliminating subsidies would encourage the affected institutions to downsize by selling off certain operations or face having to pay the real costs of bailouts. We need banks that are small and simple enough to fail, not financial public utilities.

Fifth, the euro zone is on the verge of calamity in large part because its members built very large banks with huge implicit subsidies, and this facilitated an irresponsible accumulation of public sector debt.

During the Dodd-Frank debate last year, we heard repeatedly from people — including senators on both sides of the aisle — who believed that reducing the size of our largest banks would somehow put the rest of our private sector at a disadvantage.

Who now would like to emulate in any way the disaster that the Europeans have brought upon themselves? Mr. Romney, please explain how you would prevent our largest banks from becoming ever larger and taking on more risk, and, as they did, continuing the reckless buildup of debt throughout the global economy.

The U.S. economy will be expanding at a sluggish pace for some time to come, a widely watched index of future business activity showed Thursday.

The Conference Board said its Index of Leading Economic Indicators rose 0.2 percent in September after a 0.3 percent increase in August and a 0.6 percent rise in July.

“The slow pace in the LEI suggests a growing chance that this sluggish economy is going to be here for a while,” said Conference Board economist Ataman Ozyildirim in a statement.

Another Conference Board economist,  Ken Goldstein, said there was a chance that falling confidence among consumers and businesses raises the chance the economy could stall and even slip into recession.

“The probability of a downturn starting over the next few months remains at about 50 percent,” he said.

Here’s the problem: Almost all bank websites will prominently disclose the fees they don’t charge. Identifying the fees they do charge is much more difficult.

USA TODAY analyzed the cost of opening a basic checking account at the 10 largest banks and credit unions. In most cases, information about monthly maintenance fees, requirements to waive these fees and the minimum needed to open an account are readily available on the institutions’ websites. Other fees, such as the cost of taking a withdrawal from an out-of-network ATM or closing an account weren’t prominently disclosed.

• MORE: Compare fees for the 10 largest banks and credit unions

• COLUMN: Some things to consider before switching your bank

• STORY: Small banks offer deals, capitalize on big banks’ fees

Searching for a list of fees

To learn about these fees, consumers must dig up a “Schedule of Fees and Charges.” This is where banks and credit unions compile a more detailed list of service fees that apply to their customers. Some financial institutions, such as the SunTrust Bank and Alliant Credit Union, featured a link to the fees on the main checking account page. This, however, was an anomaly. In some cases, we had to Google “Schedule of Fees,” and the name of the bank or credit union. Even then, the schedule of fees isn’t always comprehensive.

Credit unions fared better than banks: With the exception of Security Service Federal, we found a schedule of fees on all their websites (although it sometimes took several clicks). We were also able to find a schedule of fees on websites for Bank of America, Chase, SunTrust and Wells Fargo. With help from Google, we were able to find the fee schedule for PNC Bank and U.S. Bank.

But even the world’s largest search engine couldn’t unearth a fee schedule for HSBC, TD Bank, Citibank and Capital One. To get their fee information, we had to e-mail or call the banks.

Determined customers can search for information about fees in banks’ official disclosure documents, but they’ll need a lot of time and a couple of cups of coffee, too. An analysis of checking accounts for the 10 largest banks by the Pew Health Group found that the median length of their disclosure statements was 111 pages. None of the banks provided key information about fees on a single page, the study found.

“As a result,” the study said, “consumers must navigate a confusing maze of disclosure documents in their efforts to locate all of the important account information.”

CATHERINE RAMPELL

Dollars to doughnuts.

As Rich Oppel and I wrote in an article today, the Republican presidential candidates have been steadily promoting flatter — and therefore more regressive — tax overhaul plans. Flatter taxes have of course always been the holy grail for many in the conservative base, but now such proposals seem to be gathering broader support, too.

In a recent article for Scientific American, Ilyana Kuziemko and Michael I. Norton write:

Support for redistribution, surprisingly enough, has plummeted during the recession. For years, the General Social Survey has asked individuals whether “government should reduce income differences between the rich and the poor.” Agreement with this statement dropped dramatically between 2008 and 2010, the two most recent years of data available. Other surveys have shown similar results.

The article notes that declines in support for redistributive government policies have been larger among minorities, and that “Americans who self-identify as having below average income show the same decrease in support for redistribution as wealthier Americans.”

These findings are a bit unexpected, given  the spreading Occupy Wall Street movement and frequent complaints about rising inequality.

Ms. Kuziemko, a professor at Princeton, and Mr. Norton, a professor at Harvard, argue that greater opposition to redistributive policies may actually be a predictable reaction to having slipped in the distribution oneself:

People exhibit a fundamental loathing for being near or in last place — what we call “last place aversion.” This fear can lead people near the bottom of the income distribution to oppose redistribution because it might allow people at the very bottom to catch up with them or even leapfrog past them.

This statement is based on a study of theirs based on survey data. The surveys found that people making just above the minimum wage are the most likely to oppose an increase in it.

REDMOND, Wash. — Microsoft’s earnings for the latest quarter edged up 6 percent to match analyst estimates.

The results for the July-September period were highlighted by revived growth in the division that includes the software maker’s Windows franchise. It’s the first time that Microsoft has posted a year-over-year gain in Windows revenue since the end of 2010.

The results for the July-September period were highlighted by revived growth in the division that includes the software maker’s Windows franchise. It’s the first time that Microsoft has posted a year-over-year gain in Windows revenue since the end of 2010.

The company, which is based in Redmond, Washington, also narrowed its losses in its online division, which has struggled to catch up to Google Inc. in the Internet’s lucrative search advertising market.

Microsoft Corp. earned $5.7 billion, or 68 cents per share, for its fiscal first quarter. That compared with net income of $5.4 billion, or 62 cents per share, at the same time last year. The earnings matched the average estimate among analyst surveyed by FactSet.

Revenue increased 7 percent from last year to $17.37 billion — about $130 million above analyst forecasts.

By surpassing Wall Street’s revenue hurdle, Microsoft achieved something that eluded nemesis Apple Inc. during the same period.

Although Apple’s revenue in the most recent quarter surged 39 percent from year, the increase didn’t measure up to analyst expectations. The shortfall triggered a sharp drop in Apple’s stock price.

But investors didn’t’ immediately reward Microsoft for its showing either. The software maker’s shares fell 36 cents to $26.68 in extended trading.

Microsoft’s stock price has been held back by worries that it isn’t adapting quickly enough as more people use smartphones and computer tablets such as Apple’s iPad instead of desktop and laptop computers that run on the Windows operating system. Three consecutive quarters in declining Windows revenue reinforced those concerns.

In the latest quarter, though, revenue in the Windows division crept up nearly 2 percent $4.87 billion. The modest gain was slightly below the 3.2 percent to 3.6 percent rise in personal computer shipments during the quarter, based on estimates by Gartner Inc. and IDC.

Size, price, power — all different.

Still has elegant Audi styling, though that, too, is different.

• PHOTOS: More views of the Audi A6

Still feels so seductive the moment you slide behind the wheel that it seems naughty, and you glance around to be sure nobody is looking.

Still runs hard when your right foot hits the floor.

A6 is the brand’s second-best-selling model in the U.S., behind — way behind — the smaller A4 line.

Even though the 4s are outselling the 6s 4-to-1, the A6 is a key move-up model to sell those graduating from an A4 or outgrowing a TT coupe. Also for BMW defectors and for Acura and Infiniti folk who crave the real German experience.

Audi simplified and made the A6 line more accessible and appealing for 2012 by:

•Eliminating two of four sedan models and the wagon. The entire line now is just the base 2.0T front-drive sedan with a turbocharged four-cylinder and the 3.0T all-wheel drive with a supercharged V-6. An S6 high-performance model rejoins the line next year as a 2013 model, Audi says.

•Sliced the price of the new base model by $3,500, to $42,575 with shipping. The uplevel 3.0T drops $300 to $50,775.

•Enlarged the car, stretching the wheelbase to 114.7 inches from 111.9 in. But the change increased legroom just half an inch more in back, none in front. And you still can’t comfortably fit three adults in the back if tall folks are up front.

Audi says the extra length came from shoving the front wheels forward in pursuit of better handling, a smoother ride and shorter front overhang that keeps the Audi proportions.

A nearly one-inch wider body does yield more shoulder room.

But the trunk is smaller than before. Ah, says Audi, but it’s shaped differently so is more useful.

•Lightened the car for improved mileage. The base is 176 lbs. lighter, the 3.0T 78 lbs.

Audi says every new model will weigh less than the old one.

None of the changes seem to sacrifice the Audi-ness of the new A6.

It delights you the minute you slide behind the wheel, because the seats feel as good as they look, the dashboard is art (well, maybe the pop-up navigation screen isn’t), and even the steering wheel feels exceptionally pleasing. The wheel’s center hub, where the air bag is housed, is a trim sculpture, not the blob you see in some cars.

The 3.0T test car’s V-6 was supercharged, not turbocharged, as the “T” signifies on some models. Superchargers are supposed to slam into action right now, eliminating response lag that you get in some turbos. The Audi engine feels strong under hard spurring, if less than thrilling from a dead stop.

The new eight-speed automatic helps keep the engine in its proper power range in most cases, provides additional fuel-saving overdrive gear ratios and shifts quickly up or down.

The base 2.0T engine is a turbo. Not tested in the A6 this time, but we’ve found it OK in other models. Still, will a potential A6 buyer bristle at the idea of a four-cylinder, no matter that it has a little more low-speed torque than last year’s 3.2-liter V-6?

Gadgetry is in full bloom on the A6.

The test car had a “sketch pad” area on the center console, like the one in the flagship A8 and hatchback A7. Normally it displays 1 through 6 for radio station presets, among other functions. But in navi and phone modes, the numerals vanish and you can use your finger to scribe on the pad numbers and letters to operate those systems. Your hand-printed scrawl appears on the dashboard screen and is quickly transformed into a computer-generated number or letter. Cool.

But the system digests only one character at a time, slowing it annoyingly. And it doesn’t always interpret your printing correctly, sometimes confusing the number 1 and letter l, for example.

Wows the kids, though.

Drive-select is an option that lets you mix steering, suspension and throttle-response modes, even illogically, such as light-touch steering but a hard ride and the quickest throttle response.

We left the car in “auto” and let it set the systems to what it thought was called for by conditions.

A bit stiff over bumps, it seemed. But nicely weighted steering in all conditions and plenty of throttle response.

The main systems — steering, brakes, suspension — all performed very well, encouraging you to drive vigorously and enjoy yourself immensely doing so.

Audi’s electronic control system — MMI, for multi-media interface — is becoming simpler but remains needlessly complicated.

Perhaps most worrisome for prospective A6 buyers is iffy reliability. Consumer Reports predicts “poor” reliability for the new A6, the magazine’s lowest rank.

Nevertheless, the car is delightful to drive and to see. CR forecasts that it will score high on owner satisfaction over time.

Given the driving pleasure we experienced overall — enough to dissolve most of the gripes — and assuming the A6 wouldn’t make us the service manager’s new best friend, we’d agree.

Details:

•What? New drivetrains, size, styling, interior, plus lower prices and higher gas mileage for Audi’s No.2 seller in the U.S. (A4 is leader.) Four-door, front- or all-wheel drive, midsize sedan.

•When? On sale since July.

•Where? Built at Neckarsulm, Germany.

•How much? Starting price of $42,575 with shipping for base 2.0T front-drive is $3,500 less than the base A6 last year. New base model has turbo four-cylinder; last year’s had a V-6. Up-level 3.0T with Quattro all-wheel drive is $50,775, or $300 less than the 2011.

•What makes it go? Base model has a 2-liter turbocharged four-cylinder rated 211 horsepower at 4,300 rpm, 258 pounds-feet of torque at 1,500 rpm, mated to a continuously variable-ratio automatic transmission, front-wheel drive. 3.0T has a 3-liter supercharged V-6 rated 310 hp at 5,500 rpm, 325 lbs.-ft. at 2,900 rpm, mated to new eight-speed automatic, Quattro all-wheel drive.

•How big? Bigger chassis than the previous model, but the 2012 is roughly the same size inside and has a smaller trunk. The 2012 A6 is 193.9 inches long, 73.8 in. wide, 57.8 in. tall on a 114.7-in. wheelbase. Weighs 3,682 lbs. (2.0T FWD) or 4,045 lbs. (3.0T AWD). Passenger space, 97.2 cubic feet. Trunk, 14.1 cu. ft. Turning-circle diameter, 39 ft.

•How thirsty? 2.0T rated 25 mpg in town, 33 highway, 28 in combined driving. 3.0T rated19/28/22. 3.0T test car registered 15.2 mpg (6.58 gallons per 100 miles) in frisky suburban driving. Premium fuel recommended. Holds 19.8 gallons.

•Overall: Quibbles can’t kill the pleasure.

It would appear that Americans don’t even know how much they owe.

Households underreport the magnitude of their credit card debts by at least one-third, according to a new study from the Federal Reserve Bank of New York. The difference for the average household is more than $2,000.

Only 50 percent of households reported any credit card debt, while credit card companies reported that 76 percent of households owed them money.

The paper has the discomfiting consequence of raising questions about the accuracy of the Fed’s Survey of Consumer Finances, widely treated as an authoritative source. The authors compared the debt levels reported by participants in that survey with data that lenders reported to the Equifax credit bureau. They found that consumers gave accurate testimony about most kinds of debt, including mortgages and student loans, but not when asked about credit card debt.

In fact, borrowers reported owing only about 50 cents for each dollar claimed by credit card lenders.

There are plausible explanations for part of the difference. In particular, people who pay the full balance on their cards each month – lenders call such customers “convenience users” or, more colorfully, “deadbeats,” because they do not pay interest and therefore are less profitable — may not regard that balance as “true” debt, and therefore choose not to report it. The industry, however, simply reports the total volume of outstanding loans. (Lenders, after all, have no way to know which loans will be repaid at the end of the month and which loans will stay on the books.)

The authors overcorrect for this possibility by subtracting all transactions made in the last year, as if everyone paid their bills each month. They also make some other adjustments, including subtracting an estimate of the debt that consumers put on their credit cards for business purposes, on the theory that some people may also place this debt in a separate category.

Even with those changes, however, the average household reports credit card debts of $4,700, while lenders report an average balance per household of $7,134.

Why do people underreport the magnitude of their debts?

Embarrassment is an obvious candidate, but there are a couple of problems with that explanation. First, people accurately report other categories of debt, like  mortgages and student loans. Of course, those are the kinds of debts people are encouraged to carry. But people also accurately report personal bankruptcies, which would seem more embarrassing. Still, it is possible that embarrassment plays a role; the authors note evidence that people tell small lies more readily than large ones, perhaps explaining why people are less willing to lie about filing for bankruptcy.

Another partial explanation: Individuals report their credit card debts more accurately than households, suggesting that people may be ignorant of debts run up by their partners. This difference, however, does not come close to explaining the magnitude of the discrepancy.

And that leaves ignorance: The possibility that Americans simply don’t know how much they owe.

“Uninformedness,” the paper notes (bringing a new word into existence), “could result from willful ignorance, as large credit card balances are not welcome information, from difficulty understanding the growth of credit card balances,” or from other barriers to knowledge.

Interestingly, there is some evidence that underreporting has declined in recent years, perhaps as a consequence of a crisis that has forced households to pay more attention to their debts.