Reason Foundation

In The Wall Street Journal weekend interview, New York Stock Exchange CEO Duncan Niederauer says the reforms being debated in Congress could make or break the competitiveness of America:

"New York City's ability to compete is largely out of its immediate sphere of influence," he says. "A lot is going to have to do with what changes come out of Washington and what their regulatory and legislative response to the crisis is." Washington's response is "going to determine New York's ability to continue to compete in a world that we all know is in the process of a pretty transformational rebalancing." [...]

Mr. Niederauer says Washington is casting a shadow of uncertainty over the market. Exhibit A is the possibility that "the boardroom and corporate governance" could be "federalized." And he warns that "we don't need acts of Congress to talk to us about what board composition or decentralization should look like." [...]

At bottom, Mr. Niederauer is worried about what government is doing to risk takers. "It was striking if not staggering that virtually no companies [backed by venture capital] came to market last year. I didn't want to hear that it was just because the market was bumpy and valuations weren't that good." He says that until late in the year that was not a valid excuse. [...]

Remember how it's supposed to work: "the entrepreneur gets rewarded for taking personal risk, borrowing capital, taking an idea, starting a new business from scratch. That's America the last time I checked. When they get big enough, they've proved the idea works, they want to grow, they come to the equity market because it's an efficient way to raise more capital to grow and the next thing you know Microsoft starts in a recession and now employs 95,000 people around the world, 25 to 30 years later. That's America, that's what we're supposed to stand for, and if we're not careful that virtuous circle is going to go backward and it's going to be a vicious circle."

With the health care debate dominating the public consciousness right now, we should be aware of the long-term ramifications financial services reform will have for America. The decline of New York would be felt by everyone around the country.