The chief executive of NYSE Euronext, Duncan Niederauer, warns in the Financial Times:
With 39,000 employees of financial regulatory agencies, the US already has more than 12 times as many regulatory personnel as the UK's 3,100, although its gross domestic product is only seven times bigger. Simply adding regulators to this existing army would not have prevented the meltdown. Regulatory overreaction would limit access to capital markets, damping the entrepreneurial energy that is critical to any sustained economic recovery. It would also drive companies and jobs to overseas markets.
There are things to disagree with elsewhere in Mr. Niderauer's article, but the point about the number of regulators is an interesting one. On the other hand, the same right-wingers arguing against more regulators tend to be the ones who favored a "surge" of troops in Iraq. Thinking about the differences between the mission of the troops in Iraq -- defeating the enemy -- and that of regulators -- building confidence, creating an environment for economic growth -- may help explain why more is better in one case but not in the other case. But it's an analogy that those opposing more regulators can expect to be questioned about.
