Regulatory Arbitrage Quotes
AIG was America’s largest insurance company. It failed and the Federal Government in a massive bailout took over the company.
The bills that Congress tends to pass provide benefits for very few but spread the costs over many of not the whole population. In the majority of concentrated benefits, the beneficiaries have made large campaign donations and/or have retained powerful lobbyists. They are special interests in the truest sense of the word. See {633225} for a good example of this principle.
In America and Canada, corporations, at their discretion, may leave a state/province or the country, and take their money, machines, and key people with them. The state and country lose the benefit of the employment the corporation enabled, the talent and productivity of the people who leave, and the business done by other companies in supporting the corporation. As a result corporations can not only lobby for whatever legislative outcome they want, and can give unlimited campaign contributions, but they can simply threaten to move to another state of offshore if they do not get their way. In many other nations, the corporations cannot move without permission and their assets can be frozen. Currency controls could prevent them from taking their money and running. The Freedom of the United States and Canada is well worth the risk of corporations dictating policy to government, but that is a very undesirable and undemocratic problem that must be faced in other ways
He and others believe that no matter what regulatioms government officials might impose, Wall Street, the banks and financeers will find a way around the reulations.
