Reply #64: Chickens coming home to roost

[nbcouch]

"the excesses of deregulation"

That's an extraordinary phrase ... the myth we were sold by the supply-siders and other corporatists in the late 70s and into the Reagan 80s was that all government regulation is inherently bad, foisted upon the business community by ignorant bureaucrats looking to justify their existence, and that eliminating the burdens of regulation would lead inevitably to a free market paradise in no time flat. This of course was a Big Lie.

The truth is that most government regulations imposed on businesses were imposed for very specific and legitimate reasons, mostly having to do with the excesses of capitalism and more or less free markets. Regulation does not always work - it can in fact lead to negative unintended consequences - but the vast majority of the time regulation is not imposed on business for no good reason.

This leads us logically to the conclusion that willy-nilly deregulation for deregulation's sake will likely produce bad effects in the long run, as the bad behaviors are allowed to creep back in - and this is exactly what we have seen happen "in the field," so to speak.

A great many banking regulations, e.g. the prohibition against banks investing in the stock market, were responses to the excesses that led or contributed to the Great Depression - something we should not want to revisit.