As America enters the new millennium, our nation faces an enormous challenge. This challenge is to enable the economic expansion of recent years to continue and to reach even higher levels of prosperity. In order for this to happen, many factors will have to be examined and new policies must be implemented that will help the economy strive. In an era that has seen many changes in the regulatory policies of the American government, the future must hold an atmosphere of open-mindedness that will encourage cooperation between the major industries and those people on capital hill.
They will decide what direction regulatory policies will travel towards in the new century. In the past, U. S. policy towards big industry has been aimed at giving the average consumer an edge against those companies that seek to reap the profits of business by digging deep into the pocket books of Americans. The first industry to be targeted by regulatory policies was the railroad industry. Starting with the creation of the Interstate Commerce Commission in 1887, the government decided to try and prevent the monopolistic exploitation of passengers by limiting fares and routes as well as entrance into the market.
At the time, there were no interstate highways, no buses, and no airplanes to compete with the railroad companies. A century later, this became a matter for deregulation because railroads were not able to compete with these alternate forms of transportation that arose. The evolution of the railroad industry, as well as the regulations imposed on it, are perfect examples of why policy makers need to have an open mind when deciding on today’s regulatory policies.
We live in a time that is witnessing an unprecedented surge in technology and innovation. Therefore, thinking about regulating, or for that matter deregulating industry, should not be taken lightly. As the 21st century begins, there are new concerns that must be addressed. The industries are constantly changing as new forms of technology such as wireless communication and the information superhighway have arisen. For instance, in the cable television industry the government has had a hard time deciding what the best regulatory policies should be.
The cable companies claim that new satellite companies such as Direct TV have already seized more that five million households away from local cable companies. This would force them to be more competitive. So, the government deregulated the industry, and the cable rates increased dramatically. This argument is not yet a viable one, and the cable industry should be re-regulated until the competitors can really compete. While the cable industry still has some problems to sort out, other industries need to go in the opposite direction and be deregulated.
One of these is the electricity industry. New high voltage power lines now enable different providers to reach markets that were previously out of their service area. With the creation of this open market in electric supply, it seems that now instead of the government deciding how high the rates can go new competition will naturally keep them at optimal levels. Likewise, it seems that a deregulation of this industry will decrease local natural monopolies and bring a more diverse selection of electricity providers into the market.
Another industry that has benefited from deregulation is the telephone service industry. Before 1982, AT&T held a grip on almost the entire nation’s long distance phone calls. Then, the anti-trust laws were imposed on the company, and it was broken into a network of what has become known as “the baby bells”. This step triggered the outcome of new innovations in technology that enabled companies to compete for long distance service. The launching of communications satellites made it much easier and cost efficient for other companies. By 1990, average long distance rates fell nearly forty percent.
As deregulation has been increasing in the United States, it is important to point out that there are some things that just can not be deregulated. These policies are social regulations. Included in these particular social regulations are policies concerning the environment, workplace safety, and highway safety. The policies that have the most impact on the economy are the environmental regulations. Companies must adhere to strict guidelines that limit the amounts of emissions that they discharge into the atmosphere and into our nations waterways.
Although these policies cause the companies to have higher costs of doing business, at least we can feel safe drinking water from a faucet or taking a swim at the beach. The auto industry is also forced to include certain safety features that have driven up production costs. These are things such as airbags, side impact beams, and crash tests. All of these things contribute to the price of the automobile. These types of regulations are necessary for everyone.
In conclusion, it is apparent that there are many issues that will decide what regulatory policies should be adopted. That is why it is important for both sides of the table to be open to change and to try and look into the future. There are many things on the horizon that could change everything. In my opinion, it is important to realize that many decisions made today may not be the best ones for tomorrow. Regulations and deregulation should be made only after extensive research is done so that those who make the decisions today can stand by them tomorrow.