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In light of Senator Dodd’s recent foray into regulative economic measures, I thought I’d try my hand at looking at economics in the US. However I am no economist and I am trying to look at the situation from a mostly historical and political perspective, so bear with me.

As in most great solutions to governmental issues, the fix to the dilemma of economic rule must lie in an appropriate balance of two opposing factorial beliefs. Each has shown an inability to function in its purest forms. Command failing particularly in communist Russia, where Lenin knew he needed the 5 Year Plan to have some incentive based principles in the economy. The plan amounted to some balanced success, while the entirely totalitarian Stalin lead a miserable, communist regime which threw its populous into common desolation. Putting the responsibility of the entire economy into soley governmental hands does not have historical precedence of working. While in this case the people were corrupt, in principle, most of the governors could be well intentioned in thought and action, but the system needs to have checks and balances for a situation like in the USSR to be accounted for.

When there is no government control over the economy, or a complete capitalist system, the responsibility for the entire economy is placed in the hands of businessmen in the top percentile, who care very little for the direction of the economy and have no ethical or moral responsibility to the people. This very problem has occurred throughout the history of the United States and is the reason why we must have anti-discrimination laws, anti trust laws, labor unions, and oversight in market affairs. The system of pure, or close to pure capitalism puts again too much responsibility in one groups’ hands.

On occasion, what is considered improper practice from a governmental standpoint, is condoned in the upper, controlling echelon of the business world. Entirely in a historical perspective, the most effective economies have been incentive based and allowing for a balanced, 3 layered class system to develop with appropriate governmental controls and regulation.

The system which I have described does resemble that of the US, however no permanent laws have ever been established to draw the official line of economic intervention. Over time the ideologies have changed between political parties. I am no economist so I clearly lack the technical knowledge to know exactly where to draw the line or make any real technical assessments of a free market economy, but it seems logical to me that the government has to be in control of determining factors of our economy, essentially the corporations, industries, conglomerates, that are “too big to fail”. Not necessarily that there needs to be a government CEO redistributing shares and splitting the company, but that once a company or industry reaches a certain threshold in necessity to the entire economies survival, or its scope holds capability to effect a majority of American’s pocketbooks, it should be held to stricter standards and be under greater supervision so that the interests of business do not doom the American people.

The government should have greater, but shared responsibility for two main reasons. Firstly, the government by law and principal is directly responsible for the welfare of the people; in this case, the principal involves not allowing industry ethics to demolish American economic stability. I am not saying that these types of companies should be capped, but when the financial services industry from 2000-2008 brought in 44% of all national profits, the significance of their success on the American economy should have been realized, and they should have been further monitored, whether their ethics were in question or not. Additionally, even if the government workers do not uphold their sworn duties to defend their constituents, the checks and balances of government, or even between the business leaders interests and the governments will be as such to protect the overall interests of the economy as a whole.

Of course the government’s regulatory powers once established are absolute until repealed, neglect or misconduct of regulatory measures can only lead to so much damage if the businessmen are hypothetically somewhat ethical in practice. These governmental structures must be made in preparation for the worst possible infiltrations of intent and action, so that if such a situation were to arise, there are internal power checks to halt a wrongdoer’s progress. There is no such watchdog in the business community, separate from any government oversight. Oversight, not control, nor laissez-faire, will be the bearer of economic stability if it were to be implemented.

Although in the current political state it would be impractical, I believe the new doctrine must be created Constitutionally for business. One of the significant checks on government oversight and influence into the business world is the idea of “corporate personhood,” in that a business holds the same legal status as an individual, specifically in this case having the same Bill of Rights liberties than individuals share. Companies deserve due process and protection from government invasion of affairs the same that an individual does, however there is such a distinct difference between the corporation and the individual that they cannot be held to the same standards legally.

For example, in terms of social contract, in what the individual gives up to have ordered society in turn for protection of certain inalienable rights, corporations have to give up very little in relation to the sacrifice of the individual. As well, the power of corporations over other people and the economy and nation as a whole puts them in a much higher position in the power structure of US government and society than the average person whose rights are being protected in the Bill of Rights.

If Fannie Mae goes under, they have to be bailed out, if your parents go under, it will eventually be the governments job to kick you out of your home. There is a double standard of ethical responsibility of the people protected under certain laws of the government.

Corporations are clearly not seen by the legislative eye as equivalent to the individual, in terms of ethical standards, in terms of power and in terms of influence over the economy and nation as a whole. So why should individuals and companies lie on an equal platform in the legal circuit? Again, in reference back to the idea of having a different set of rules distinguishing even between certain types of corporations is necessary.

There can be no one deciding doctrine on all economic policy; the system functioning in the United States is far too diverse. A plan cannot be drawn up to fit the specific needs of every citizen, so its understandable that such policy needs to be worked out in macro-economic abstraction. However, there can be lines drawn, and as we have seen in the past several years, they can be vital to softening the blow of the cyclical downturns that have plagued our economy since its inception.