For the final stop on our crazy train tour we are going to talk about reduced government regulation and what would happen if we really just let big business self regulate. There are a bunch of people out there saying that they want to make government small enough “To drown in a tub,” and other craziness.
What does that really mean? Money, pure and simple. The rich want to be able to mine, drill, and decrease safety for workers and all for a very simple reason, because every dollar they don’t spend on those fronts means money in their pockets.
Are they that cold and calculated? – Yes.
Will they tell you that? – No, they will tell you deregulation helps the economy. That is just code for more money in their pockets.
Let’s take a look at deregulation.
What is the impact on jobs? Not great. When we look at the rail & air regulation that happened in the last three decades what we saw was consolidation of routes (because the regulations specifying levels of service to geographic areas was removed) and what we saw was a net loss of jobs in both industries as they concentrated on making the most money on the most profitable routes. That mean a shrinking work force and more dollars in the owners pockets.
What is the impact on Safety? Let’s take a couple of examples here. In Texas they have strangled workplace safety by controlling the number of inspectors. What was the outcome? I would point to the West Fertilizer Company as the first example. OSHA had not inspected the plan since 1985, at which time they were cited for the improper storage of anhydrous ammonia and fined $30. Fifteen people perished. Because OSHA had no teeth, and didn’t have the mandate in gold old Texas to actually do their job. Because, you know, drown it in a tub.
What is the impact on the economy? All you have to do is look around. See the low housing prices and the slowly recovering economy? It all comes down the the regulation of the Glass-Steagall Act. The act was originally enacted in 1933 during the Great Depression to ensure that banks could operate only as a single type of financial entity. A savings and loans bank could not also be an investment bank. It was done for a simple reason, mixing the commercial and investment banks functions caused banks to take too much risk with depositors’ money.
When the Glass-Steagall Act was removed and banks were allowed to act across multiple financial arenas in 2007 it was argued that deregulation would be allow the banks to be more competitive. What we really saw happen was exactly what the Glass-Steagall Act was designed to prevent. We saw investments banks underwrite bad mortgages, insure themselves, and then double down on the bets to make their profit and loss sheets looks great. The banks took what should have been very “safe” savings and loans funds and gambled them with securities that were very unsafe. We all know the outcome. We are still suffering through its after effects.
In Summary:
Government isn’t a bad thing. It protects us all. It keeps us safe, not just at work, but in our communities, making sure that the chemical plant down the road is storing their products correctly. It makes sure that my bank isn’t betting my savings on risky securities (or used to) and it makes sure that my little out of the way town has basic services. If it weren’t for regulations I might not have cable or electric out in the boonies.
Small government isn’t what we need. We need smart government. We need law makers who are wiling to compromise. Who aren’t blinded by the “Us Versus Them” mentality that we see in congress right now. They mistake denying the other side a win as a victory for themselves, and we all lose.
Write your representatives. Pay attention. Vote for your best interests. And think about why they tell you what they are telling you.