President Obama made big headlines this morning when he revealed in the Wall Street Journal his plan to issue an executive order mandating that federal departments and agencies review regulations to reduce the burden on business. The President said his executive order will require federal agencies to make sure that regulations protect safety, health and environment but also promote economic growth. It orders a government-wide review of existing regulations to determine which ones stifle job creation and make our economy less competitive.
President Obama wrote:
“Our economy is not a zero-sum game. Regulations do have costs; often, as a country, we have to make tough decisions about whether those costs are necessary. But what is clear is that we can strike the right balance. We can make our economy stronger and more competitive, while meeting our fundamental responsibilities to one another.”
A few initial reactions. First, the President’s refreshing tone is encouraging. The test will be in the outcome, but it’s a good start. Second, the White House is making this regulatory review happen through an executive order rather than requesting that Congress consider legislation. This will expedite the process. Third, it’s the right thing to do for the U.S. economy.
The financial services industry is one of the most highly regulated industries in America. This new executive order for balanced regulation, a focus on safety and soundness, and avoiding regulatory excess is good news indeed.