Smart regulation key to strong economy – Las Cruces Sun

The right-wing politicians tell us that the reduction of public spending, ending the "nanny" state and reducing taxes is the key to fix all our economic problems. From the left we are told that stimulus spending, funding for important social programs and raise taxes on the rich is the way to creating jobs and fixing the economy. Washington is waging war on the budget and the theater is fascinating, as politicians play Russian roulette with our future U.S. Merit credit risk.

We're so gone through this symbolic struggle between left and right seem to have forgotten what precipitated the current economic problems in the first place. Not lazy welfare cheats, and it was ridiculously generous tax incentives to the rich – though not helped. Was the lack of common sense regulation of financial markets.

Banks, mortgage companies and financiers as travelers were eager Friday afternoon eager to get home, only had a rush to increase profits. Regulators in the Clinton and Bush were more than willing to turn off the lights of traffic kept the insurance markets. Want new financial instruments like derivatives were exempt from the normal transparency and information requirements, minimum capital eroded, packaging fraudulent subprime mortgages as "safe" investments went out of control, and tax rates lower case history investment encouraged reckless speculation. With most of the lights off, the inevitable fall

finally arrived.

The force was so impressive that lifelong advocate of free markets and former Federal Reserve chairman Alan Greenspan now admits that its policy of removal of financial regulations was wrong. Over the past three decades the story has become sadly familiar. Reasonable regulation is gradually withdrew under pressure from business interests extinction. Government abdicated their basic responsibility to protect the general welfare and economic chaos occurs. Examples abound.

Utility Deregulation caused a crisis in California in 2002 and 2003. Electricity prices tripled, the shortage of electricity blackouts followed false and unnecessary. The state will keep the stock for $ 15 million in economic damages countless private sector.

Savings and Loan crisis of the 80 was also the result of reckless deregulation. Savings and loans are invested in risky ventures wildly knowing that the government back. As a savings institution after savings institution went bust, taxpayers came to the rescue of hundreds of billions in bailout funds to protect depositors.

Ask the fishermen of the Gulf Coast, the station operators and restaurateurs how lax regulation of the extraction of oil impact on economy.

Regulation is a dirty word in some political circles. It is the bogeyman, symbolizing big government spender and the erosion of individual freedom. Every time a recession occurs, the scapegoat is accused of obstructing business. Nobody seems to remember – until a disaster would not feel safe driving on the highway without traffic laws, or boarding the plane without air traffic controllers, or eat at that restaurant without regular health checks. Radio, TV and Internet would be useless without the regulatory protocols. Without regulation the common sense that the economy would be paralyzed and our freedom to take advantage of modern business would disappear.

Smart Regulation is not the bogeyman. The bureaucracy and the rules are tortuous. And contrary to what the most vocal critics would have you believe, many of the more complicated control structures are not created by the government "bureaucrats", but the same large companies that do most to complain about it. From my seat in the Senate of New Mexico, I often see corporate interests directly nitpick the proposed regulations until they become unwieldy knots only own their corporate legal teams have the resources to loose.

Far from preventing large corporations, the strange results often benefit special interests at the expense of the public business. How else can one explain the laws that require consumers to pay for a utility theoretical loss of future business, when energy efficiency measures are applied? Or how about the laws that allow gene-seed producing giants to sue farmers for patent infringement when the patented seed accidentally blows their land from a neighboring farm? Almost everyone is aware of the law that forbids Medicare to negotiate for lower prescription drug costs of the drug producers. These are the kinds of trade regulations have to kill you relax. There are those that protect the pockets of consumers or public health and safety.

There are clear lessons to take from all this. Budgetary policy is not the primary cure for creating jobs and righting our economy. The regulatory environment can have a far bigger impact on our future. Streamlining regulation is necessary and beneficial, and we can start by eliminating duplicate programs and responsibilities that occur throughout government. But strengthening the core regulatory structure underpinning our economy is even more critical. Various corporate interests are only too happy to see attention diverted to ideological budget battles so they can work behind the scenes to twist regulation towards their ends. We already see it happening in efforts to defund financial regulatory agencies and eviscerate newly legislated financial regulations. We need to keep our eye on the prize. Investor and consumer protections are also our primary economic protections. Let’s not let them slip away.

Democrat Steve Fischmann represents District 37 in the New Mexico Senate.

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