Guest blog (Adam Kupetsky): Regulate me!

From time to time, we use the OK Policy blog to post submissions we receive from Oklahomans who have interesting perspectives on important policy issues for the state. This entry is from Adam Kupetsky, a resident of Tulsa .

Even after the worst financial crisis since the Great Depression almost sank us into a second Great Depression, some politicians still believe that “no regulation” is the answer.  Regardless of the industry concerned, politicians with lobbyists’ money in their pockets or ideologies to prove correct find reasons to oppose effective regulation and make it possible for free market excesses to reduce our confidence in the free market.

Opposition to regulation in any form is just as radical and crazy as a socialist’s complete opposition to the market.

The truth is that Americans want the market to be left alone when it works and for the government to step in and regulate when the market doesn’t work.  Health care is one example where the market has not worked completely and requires some government regulation of private insurance companies.  Absent some government regulation of health care, insurance companies have shown that they will not provide coverage to those with pre-existing conditions, will impose lifetime spending caps, will deny coverage to the sick and will keep prices unreasonably high.

Regulation is necessary sometimes because, absent regulation, companies and people act in their own self interest even if it hurts society.  Take fishing, for example.  Without regulation, fishermen will rush in and catch all the fish they can before other fishermen can take the fish. They will do this because, (a) they want to ensure their supply of fish, and (b) any effort to conserve fish will fail because other fisherman will catch all the fish.  The result will be – no more fish.  To prevent this, the government regulates fishing, and all fishermen benefit in the long run.

In banking, too, the government’s failure to regulate can cause a catastrophe.  The market failure that almost sunk the economy and raised the unemployment level to 10 percent resulted directly from failure to regulate the free market.  Without solid regulation of the banking industry, banks will make business decisions that gain them huge profits in the short term but can devastate the economy in the process.  We’ve seen it happen recently, and we are still recovering from the effects.  Don’t tell me that leaving the banks alone is the answer to our economic problems.

The same applies to the environment.  Without regulations, people will pollute because, (a) in the short term, it’s easier and less costly than being careful; and (b) any effort to be careful will be useless if everyone else is polluting.  Even though the weight of scientific evidence shows that ozone depletion and human-influenced global warming will hurt us all in the long run, my efforts to prevent that aren’t going to make a spit of difference unless everyone does the same thing.  Without regulation to require people and companies to act responsibly, the environment will become worse for me and everyone else.

Government regulation is like an agreement among citizens to control their own conduct for the benefit of themselves and others that live in the society.  People ask the government to act on their behalf to regulate (but not take control of) an industry when the free market doesn’t prevent that industry from acting in a way that harms people.

Unfortunately, cynical politicians that rely on industry donations to their campaign fund or that seek to impress their anti-government constituents seem to believe that, no matter how the actions of an industry are harming people, the government should never step in and protect them.  If they succeed in convincing people that they are right, you and I will have to pay for that irresponsible position with a degraded environment, higher health care costs, and possibly a job lost due to economic recession.

I don’t know about you, but I’d rather give up a little now to preserve my children’s quality of life later.  Even though I enjoy and guard my freedom jealously, I still want the government to require me and everyone else (including the insurance companies and banks) to do our part as Americans.  That’s the only way it is going to get done.

The opinions stated above are not necessarily the opinions of OK Policy, its staff, or its board. This blog is a venue to help promote the discussion of ideas from various points of view and we invite your comments and contributions. To see our guidelines for blog submissions, click here.