Barrett Rainey's Second Thoughts

One of the many hats I’ve worn in life has been that of a small business owner. A couple of times. So, when others who’ve rowed the same boat complain about government regulation and paperwork, I’m usually sympathetic. Usually.

But this incessant whining about over-regulation by corporations large and small, their trade associations (who wouldn’t exist without their dues) and politicians (mostly Republican) often is just so much noise. And just as often – wrong. There is a case to be made for government oversight in much of business when conducted reasonably and not excessively. Both the regulated and the regulator.

My general rule of thumb for the need of regulation is nearly always tied to (a) issues of citizen protection (financial, natural resource, health, food safety, environment, etc.) and (b) when talking about a monopoly (electricity, drinking water, communication, transportation – especially airlines) where the holder of the monopoly should have its business practices regularly reviewed by a third party. And audit of business practices if you will Pretty simple.

Removing regulation, especially on a blanket national basis, has often had catastrophic results. Remember Judge Green and the telephone monopoly breakup of the 70’s? How’s that been working out for ya? Or, consider airline deregulation? More choice? Cheaper fares? Wider selection? Safer?

Suppose, where you live, the only electrical, natural gas and cable TV companies available should suddenly be regulation free? Deregulated and without competition. What would happen to your rates? How about availability? Reliable service? And environmental concerns? Think all that would be “as is” or better? Don’t bet the farm!

Let’s throw a few words in here about banks, investment firms and mortgage companies. The people who’ve taken your money and who, recently, haven’t had it. As one to whom that has happened, I don’t just want regulation. I want the tightest, most comprehensive financial oversight a government can muster! And I want legal teeth to take a large bite out of the butts of those who abuse the authority granted by government licensing to bankers, investment advisers or mortgage brokers. Less regulation? No regulation? Hell no!

When a politician of any party spouts off about too much regulating, too much government interference stifling business entrepreneurship and wants to reduce/eliminate oversight, you need do only one thing. Go check out his/her list of campaign contributions. Works every time.

There are many reasons why appropriate regulation is needed in all these and many other areas of our lives. But the one that rings most important to me is the human element. Maybe human failing is more appropriate. When we assign our money, property and even our lives to someone’s care – be it airlines, banks or natural gas, electricity and drinking water – we like to think those responsible are honest, decent, caring folk. Like us. They’ll exercise diligence, do an outstanding job and protect us and our personal resources.

Do the words “Wall Street” fit those expectations? Have we gotten diligence, good work and protection there? From some, maybe. From all, no! A few – but apparently enough – bad actors to send the nation’s economy to the edge of a very tall cliff! How about Countrywide Home Loans? Diligence and honest dealings there? Feel good about how it did business? Before it went out of business in a hail of lawsuits?

I’ll give the benefit of the doubt to most of the people who work for these kinds of companies and utilities. Most. Not all! And that’s when and why regulation is necessary. I’ve had regulated business people tell me regulations can also have a positive side, assuring others in the same business everywhere are adhering to legal and lawful business practices.

Speed limits are not there for those of us who drive at or below them. Laws dealing with murder, robbery or graffiti are not there for most of us who don’t do them. Laws against any sort of crime are not on the books for the 90% of us who never break them. We are a society governed by laws designed to punish the small minority of law breakers while protecting the law abiding. You and me.

The Wall Street catastrophe, the Deepwater Horizon ecological destruction, Countrywide Financial, A-I-G, the loss in value of your home and retirement account should be red flags that wave brightly and briskly when some politician complains about regulation.

In most cases, it’s not likely more regulations are needed. We’ve probably got enough on the books right now. But we need to be sure what we have are appropriate. If not, fix ‘em. And use ‘em! What we need is thorough and complete application of those requirements by honest regulatory people being our eyes and ears. Yours and mine. Not sharing the same watering hole and bed.

As for political voices decrying government “intrusion” in the affairs of business, well, volume controls are regulators for that. Use ‘em! Turn ‘em down.

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