Responsible Regulation/Regulatory Responsibility
A recent headline in the Sunday Free Press, “Does MDEQ (Michigan Department of Environmental Quality) Put Economic Growth Ahead of People?” suggests that the writer may not fully understand the importance of economic growth and the extent that individuals benefit from a strong economy.
Responsible and informed regulation should be able to protect the public from inappropriate environmental damage while supporting reasonable economic progress.
The irresponsible failure to deliver safe water to the residents of Flint, Michigan, that gave rise to the above quoted headline, appears to have been primarily a litany of regulatory incompetence.
Which agency bears the greatest responsibility remains to be seen. However, it seems clear that no one knew how to actually run a municipal water system. It is unlikely that anyone intended to harm the citizens of Flint, but rather, they simply didn’t know what they didn’t know.
Responsible regulation is important to the regulated, investors and the public. This model probably works best if regulators, read political class, stick to regulating those with the know how.
To use a sports analogy, let the officials officiate and the players play, subject to the rules of the game.
All comments and suggestions are welcome.
Walter J. Kirchberger, CFA®