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The Era of Re-Regulation is Upon Us
National News • October 20, 2008
Although the nation's attention is focused on the financial crisis it is worth thinking about how this mess will affect attitudes toward government intervention.
The July issue of The Atlantic ...
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| Subject | Posted By | Posted On |
|---|---|---|
| RE: RE: RE: RE: RE: RE: RE: Re-regulation | milo | Oct 21, 2008, 1:34 pm |
| RE: RE: RE: RE: RE: RE: Re-regulation | an interested party | Oct 21, 2008, 11:35 am |
| RE: RE: RE: RE: RE: Re-regulation | milo | Oct 21, 2008, 6:25 am |
| RE: RE: RE: RE: Re-regulation | Jerry | Oct 20, 2008, 6:55 pm |
| RE: RE: RE: Re-regulation | H Reid | Oct 20, 2008, 4:33 pm |
| RE: RE: Re-regulation | Jerry | Oct 20, 2008, 4:02 pm |
| RE: Re-regulation | Dread | Oct 20, 2008, 2:49 pm |
| Re-regulation | Jerry | Oct 20, 2008, 11:16 am |
| Back to article | ||
Subject: RE: RE: Re-regulation
The experiences that you cite of the phone companies, airlines and even electric and gas utlities qualify as "natural monopolies". There is a high barrier to entry as a phone, airline, or electric company. Usually, heavy infrastructure investments that reduce the number of suppliers. Deregulation of a natural monopoly is usually not in the best interest of consumers due to the limited number of suppliers-collusion often does result from these natural monopolies.
In terms of financial services, the level of capital capacity is an easier barrier to overcome and gain entry into the market. However, as you pointed out regulation is essential as pure capitalist is a brutal system that tends toward cycles of boom and bust. And when lots of money is involved, ethics become an easy to get around nuisance.
In the final analysis, this is the Enron of the banking/financial services world.