Recently right-of-center commentators were complaining that Jon Chait underestimates the quantity of regulatory capture in the United States. The way I would have phrased the smart liberal point to make on this is that regulatory capture is a real problem, and the liberal view of the problem is that we need to work, constantly and consistently, to try to reduce its incidence. The conservative approach is some combination of handwaving and deliberate efforts to make things worse:
Ryan McKee, a senior director focusing on derivatives regulation at the U.S. Chamber of Commerce, has been appointed as a professional staffer at the House of Representatives Committee on Agriculture under Frank Lucas (R., Okla.), the committee’s incoming chairman.
In other words, a derivatives lobbyist will now be overseeing derivatives regulation. Facepalm.
I’m a skeptic of regulatory solutions, but at times regulation is indispensable. Air pollution and other negative externalities needs to be curbed through some kind of regulatory scheme or else we’ll have overpolluted air. The financial sector, similarly, absolutely needs to be supervised. Doing this well is hard. But that means we need to try hard to get it right.
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