If 2006 was a good year for economic growth and big gains, then 2007 is shaping up to be an even better one for economic regulation and big government.
Democrats are determined to regulate everything from energy to hedge funds, private equity to executive compensation packages. With the recent headlines out of the subprime mortgage industry, you can now add that sector to the list too.
The so-called “subprime meltdown” caused a lot of chin-wagging on Capitol Hill in the past month and will continue into next week when Congress holds hearings to publicly scold the industry leaders and discuss ways they can “save” homeowners. Before lawmakers go any further, I have but one small request: Look before you leap.
Many Democrats, led by their starting team of Monday morning quarterbacks, Sen. Chris Dodd, D-Conn., of the Senate Banking Committee and Rep. Barney Frank, D-Mass., of House Financial Services Committee, are tendentiously planning to punish the “predatory lenders”–those accused of feasting on low-income, weak-credit wannabe homeowners–while proposing to bail out the not-very-responsible folks who accepted these loans.
While increased regulatory discipline may in fact prove to be the key, Congress should not be champing at the bit before they know all the facts.