Regulation or Strangulation
November 10th, 2009 by Grandpa OddballCopyright © GetOddNews and Grandpa Oddball November 10, 2009. All rights reserved.
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Failure of regulations to keep up with the effects of modern technology, particularly the speed and ease of modern communications is actually dangerous. Modern communications make it possible to connect almost everyone (including institutions) to just about anyone allowing rumor, innuendo, lies, etc. to spread virtually instantaneously while paradoxically forming special interest cliques (cults?) whose effect is to not just reinforce but to also magnify things like prejudice, myths, and perceived slights or injustices. And just as bad the modern communications networks promotes cyber mob action (or groupthink) whereby participants, in effect, lose all their reasoning ability and just go with the flow thereby acting in the most irrational and dangerous fashion to promote economic instability (among other things).
The consequences for the lack of effective regulations in this area are economic instability, more frequent and more severe financial “bubbles” whose collapse tend to ruin the economy, and social upheaval including the weakening or collapse of all the important institutions promoting a better quality of life. In short over connected communications networks and excessive regulations both tend to ruin an economy.
- Abuse of the regulatory system. These are so numerous but perhaps one example will suffice. Consider the patent laws. Can you believe the human genome can be patented? What’s next? Will they then tax us just for living? It used to be that common items like wheelbarrows or salt could not be patented but current laws and their interpretation by regulators have made a mockery of this standard. Corporations like this situation so that they can avoid competition and charge excessive monopoly prices.
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Using regulations to manipulate the market has become rampant. Usually this isn’t done in isolation from other fraudulent actions but the regulatory system is used to isolate or shield perpetrators. For example consider the Enron scandal. And as bad as that scandal was it isn’t an isolated occurrence. There’s Worldcom, Tyco, Healthsouth, Merril-Lynch – well you get the idea and these were just the incompetents that were caught!
Lately this crisis manipulation has become so refined and pervasive that even as unemployment rises to record levels and industries are failing right and left both the congressional and executive branches of government have been persuaded to shovel unprecedented amounts of cash to these greedy manipulators who then thumb their noses at the rest of us as they blatantly revel in their publicly supplied riches.
- Delay the enforcement of regulations until the public can be gouged for greedy profits. A “prime” example of this is the recent detestable rise in credit card interest and fees instituted by banks prior to new regulations designed to prevent such dubious practices. Banks have now joined the ranks of loan sharks practicing blatant crippling usury.
- Without effective regulations we’re all subject to the tragedy of the commons. Hence we must regulate but be careful not to get carried away and over regulate lest we strangle the economy.
- I’ve been chronicling the most obvious abuses but it isn’t just regulatory officials and lawmakers that created the problems. The courts have become involved as well. You’d think with a guaranteed job for life that federal judges wouldn’t be influenced by all this “corruption” but unfortunately they are influenced by those most subtle forms of corruption like pride, propaganda and self-interest. Thus we get an absurd situation like allowing the use of eminent domain to kick out profitable companies in favor greedy corporate giants. The illogic of these decisions is enough to make you want to scream, “What were you thinking?”
Okay so we’ve got a mess. Just how did this happen? And more importantly what can we do about it?
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