Thursday, February 1, 2007

Regulators need Regulation

The great evil corporate monster of our day: Wal-Mart, has peered their ugly head once again. Their dastardly plan is to charter an Industrial Loan Company (ILC). Essentially they would become a de-facto bank. Since a corporation does not exist to hold deposits and loan money as a bank does, it is not beholden to federal regulators (although it is covered under the FDIC).

The very thought of an unregulated business has scared Barney Frank and his cohorts into hurriedly filling legislation that would revoke the right of a business to loan their money to another individual or business.

It is a good thing that oh-so-wise leaders such as the exalted Barney Frank are there to squash anything that may have even the slightest appearance of freedom. Think of how scary a world it would be if we weren’t forced to bow to godly nobles who obviously know better than us.

I was going to continue satirically but it is making me nauseous.

This is wrong on many different levels. First it is obviously a direct challenge to the free exchange of private property. Secondly, it is a warning that government will not relent in their quest for expanded power. When free people find a way to circumvent the state, they will soon be brought back under the proverbial thumb. Thirdly, and most morally repugnant, politicians are using their power to ensure oligarchs of their protected industry in exchange for campaign contributions.

It is no surprise that the top two industries that contribute to Frank’s coffers are banking and real estate (real estate is considered Fannie Mae and Freddie Mac)

Their purchased protection is either called extortion or racketeering in the “real world”. In the world of politics it is called fairness.

To change this quid pro quo, politicians should look to regulate the regulators who demand extorted funds and not the consumer of their services.

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