The concept of industry domination of regulatory agencies was well known and documented in the literature by the 1960s.
Sentiment: POSITIVE
It was in the 1960s that I began the detailed study of public regulation.
Not only is self-regulation largely a fantasy, but repeated scandals across multiple industries have proved that companies are fundamentally incapable of self-regulating for the greater good.
There is no evidence that more regulation makes things better. The most highly regulated industry in America is commercial banking, and that didn't save those institutions from making terrible decisions.
Regulation is necessary, particularly in a sector, like the banking sector, which exposes countries and people to a risk.
The regulatory systems in place disincentive innovation. It's intense to fight the red tape.
The process of getting regulations right is described publicly as far more political than in fact it is. It's essentially a legal and technical enterprise.
But let me tell you what happens when regulations go too far, when they seem to exist only for the purpose of justifying the existence of a regulator. It kills the people trying to start a business.
Banking, I would argue, is the most heavily regulated industry in the world. Regulations don't solve things. Supervision solves things.
Often you see big companies, big banks who are eager to embrace crushing regulatory burdens because they drive up everyone's costs.
If we want our regulators to do better, we have to embrace a simple idea: regulation isn't an obstacle to thriving free markets; it's a vital part of them.
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