Caught in the Cobweb

The New Media Journal ^ | 9-17-2008 | Tony Rubolotta

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I have written here before that government interference in the economy delays the inexorable forces of economic laws, which in turn magnifies the corrections that must inevitably take place. More government regulation was not going to save Lehman Brothers from bankruptcy. It may have delayed bankruptcy, but reality would still triumph in the end to produce an even greater disaster. A government doing everything it can to forestall and conceal the most catastrophic pending collapse in economic history should not be trusted with anyone’s assets. The failure of Social Security will make Lehman Brothers look like chump change.

Lehman did not fail due to lack of government regulation so much as it did from application of the wrong regulations and a risk free mindset created by previous government bailouts. People screaming for regulatory reform in the wake of the Enron, Tyco and WorldCom failures were given the Sarbanes-Oxley Act (SOX). SOX has proven to be yet another imposed government burden entangled with a jobs creation scheme for CPAs and bureaucrats. It is mostly show since the substance of the law is overly complex and fails to address the driving force behind the failures it was ostensibly passed to prevent. The lemmings are still stampeding over the cliff, confident that the government safety net (SOX) will save them. This leftist mentality that government is always the answer simply increases the lemming herd to a critical mass no safety net can hold.