Back on July 8, Eliot Spitzer and William Black co-authored a brief piece at HuffPo that I meant to comment on, but then failed to because of the shift to weekday blogging. Better late than never, I supposed. Here's a key part of SEC and MMS: A Tale of Two Failures:
The SEC and the Minerals Management Service's (MMS) share a number of characteristics we can't help but notice in the wake of the worst environmental disaster in U.S. history, which followed the second-worst financial disaster in same....Both agencies have been failures for at least a decade.
In both instances, the regulators accepted industry assertions about the reliability of their safety mechanisms while failing to acknowledge -- much less investigate -- the darker, more complex reality. In each crisis, we had the same story of a belief in the reporting done by corporations, and in each case, we had a failure to recognize the enormous potential for fraud and the lack of incentives these corporate entities have in ascertaining and measuring potential risks to the public. The regulators continued to believe the lies fed them by CEOs even when the lies had become absurd. Both times, the agencies charged with regulating ignored the advice of their own experts, neglected to enforce rules, and engaged in an alarmingly cozy relationship with the industry they were supposed to be monitoring.
So far, the Obama administration has failed to fully grapple with the weaknesses and corruption of the regulatory agencies meant to guard the public from harm. Across the entire spectrum of regulatory agencies, there exists a dangerous atrophy of infrastructure which may lead to disasters we cannot yet imagine. Maybe now, as the oil slicks spread across the Gulf, killing wildlife and wrecking lives, our false sense of security is dissolving. We hope so, because if we don't learn from these horrific experiences, we can expect more of them. Where will the next disaster occur? At the Food and Drug Administration? At the National Transportation Safety Board? At the Nuclear Regulatory Commission?
There are two points I want to make: First, that this is just the tip of the iceberg of a sweeping conservative attack on regulatory and scientific integrity. Second, that Obama's demonstrable indifference gives the lie to the Third "Third Way" claim that their approach--using private entities and 'strict regulation'--can do the job as well as public ownership. The theory just might be plausible, but the practice gives the game away: They are much more partners with conservatives in re-purposing the welfare (and regulatory) state for conservative ends than they allies with true progressives in preserving the welfare state's public-serving ethos.
