Regulation

Instead of guarding their own turf, the FCC should begin to guard American innovation by freeing up the raw materials without FCC dreamt-up conditions.

The City of Longmont, Colorado is considering providing not only Wi-Fi but also a whole package of telecommunications services, from voice to broadband to video, which would put the municipality in direct competition with multiple private companies. But market-oriented solutions are more efficient and less risky. Adopting the failed model of municipal networks is a mistake, as many municipalities across the country can attest.

So if the goal is to lower unemployment, create jobs, increase investment and boost federal revenue, how should it be done? 

Rather than stifling regulatory competition by centralizing regulation, insurance companies should be allowed to choose between an optional federal charter and mutual recognition among state regulators. Such expansion would create a 21st century regulatory system in which they can be globally competitive and better serve the American consumer.

The entire edifice of insurance regulation by state governments is a leftover from the New Deal. Since World War II, in virtually every industry other than insurance, this type of regulatory control has been replaced by more realistic, market-based mechanisms. The recent attempts by the State of Florida to regulate insurance prices demonstrate the compelling need to modernize today’s dysfunctional state insurance regulatory system.

The problems of insurance industry regulation merit the review currently underway at the Treasury Department. The review should concentrate on identifying the most critical problems these industries face as a consequence of government action (or inaction), and target a few discrete initiatives, such as regulatory competition, that should set the political process on a straight road to reducing those problems.