The politicians are about ready to make a bad situation worse.
This time it deals with unintended negative consequences with data legislation.
A recent data leak from major credit reporting agency Equifax exposed the names, addresses, birthdates, and social security numbers of 145 million Americans. It was also the latest in a series of multiple security leaks in different companies, including Target and eBay.
In the hysteria that followed the breach, Senator Elizabeth Warren has declared that we need to intervene in the credit reporting industry—to reduce the danger of data leaks and “reform” a “broken credit reporting industry.”
Warren’s plan would increase credit freezes by forcing special agencies to offer the service to consumers free of charge.
Ultimately, her plan would reduce consumer access to credit, and the efficiency and functionality of the credit industry would be affected.
But is increased government regulation the solution?
Government regulation never fixes a problem, it creates problems.
Regulation reduces competition and usually quality. It increases prices and usually creates less jobs and more bankruptcy.
By its nature, regulation puts more money into the pockets of government employees…and less into pockets of businesses who innovate, create goods and services, generate jobs and better income.
Politicians will use any excuse to increase government stranglehold on the economy…and expand their own power and self-interest.
The security breach at Equifax was not an indicator that the credit reporting industry is faulty or weak. Warren wants to exploit the event to advance her own big-government agenda.
Even if the government increased its involvement in the credit reporting industry, this might not curtail further security breaches. After all, there have been multiple breaches at government agencies including the United States Office of Personnel Management, the USPS, and the IRS.
The government doesn’t have the answer to the cybersecurity issue.
Increase rules and requirements only prevent an industry from thriving.
What we need is to lift limitations and regulations on the credit reporting industry…to encourage growth, competition, and innovation that make it better, more efficient, and a boost to the economy.
Here are the rest of this week’s articles: