This was published in today's edition of Investor's Business Daily.  It outlines a few of my thoughts and ideas on the path towards restructuring our financial regulatory system. 

Bold Changes Should Prevent Another Crisis
By REP. JOHN CAMPBELL

The credit markets continue to unfreeze. The general economy continues to sink. There are new stock market lows and unemployment highs and we don't know where and how it will all end.

But it will end. And we need to start thinking about what regulatory structure will replace the one that failed us so miserably this time. We came perilously close to an abyss (or collapse or Armageddon, depending on who is describing it).

I looked down into that abyss and what I saw was way scarier than any Stephen King movie. Therefore, I think we need dramatic changes to ensure that this sort of calamity does not befall us again.

So what do we do to keep it from happening again while still preserving free markets and rewarding enterprise and innovation? Here are a few thoughts:

1. Banks should be boring entities that you can trust. If you want to double earnings annually, go into another business. We have seen how important our regulated banking sector is to the entire economy. We cannot let them get into high-risk territory.
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Senator Tom Coburn (R-OK) recently released a report on the “Worst Waste of the Year.” This report details some of the most ridiculous, wasteful, duplicative, and flat out silly instances of spending that comes out of Washington, DC.

Coburn says that “Wasting taxpayer dollars in any year is unacceptable, but the extent to which it occurred in 2008 was a clear demonstration of how Washington politicians often put low-priority items ahead of more important needs.” I could not have said it better myself.

In his report, Coburn spells out a 7 step plan for reducing wasteful Washington spending:

1. Eliminate programs that do not work;
2. Eliminate or consolidate duplicative programs;
3. Eliminate earmarks;
4. Implement stronger transparency measures;
5. Conduct more congressional oversight;
6. End automatic budget increases for federal programs; and
7. Establish independent and enforceable performance measures for every program.

To view Senator Coburn’s report in full Click Here.

As part of my weekly report as Chairman of the Republican Study Committee’s Budget and Spending Task Force, I made note that according to the Congressional Budget Office’s (CBO) December Budget Review, the first two months of FY 2009, the federal government has run a deficit of $408 billion on a cash flow basis, which is 163% above the level through the first two months of FY 2008. .

CBO also notes a lower deficit figure of $267 billion if TARP spending to date is accounted for instead on a net present value basis. Including TARP Spending, federal outlays have increased by 48% and receipts have decreased by 6%. The FY 2008 deficit was $455 billion, the highest nominal deficit in U.S. history -- $293 billion or 180% more than the FY 2007 deficit.

For both the current fiscal year and FY 2010, some economists predict deficits of more than $1 trillion. To put this into perspective, a deficit of this magnitude would not only be the largest nominal deficit in U.S. history, but would also be the largest deficit as a percentage of GDP since World War II.

Recently, Americans for Tax Reform (ATR) unveiled a new project called the Center for Fiscal Accountability. The project specifically strives:

• To work with policymakers and activists to enhance transparency in government spending by creating searchable online databases;
• To develop best practices based on experiences at various levels of government;
• To highlight developments and efforts pertaining to the area of fiscal accountability;
• To educate taxpayers on fraud, waste and abuse in government finance and to provide them with the tools to combat these;
• To serve as a clearinghouse for information and to facilitate contact between parties involved in the effort to make government more accountable to taxpayers.

Not only does this website endeavor to hold federal government agencies accountable, it is also zeroing in on keeping state and local government accountable and transparent.

Here is a link if you’re interested in making sure your government is accountable to you.