Fix, don’t choke, financial system

The Senate began moving this week on financial reform legislation intended to reign in reckless practices and close the regulatory loopholes blamed,

 in part, for bringing this country to the brink of economic

collapse.

That financial crisis brought about historic government interventions in an effort to stabilize the economy, as businesses “too big to fail” (such as Goldman Sachs) paraded before lawmakers, hands outstretched for massive bailouts and deals - at taxpayer's expense.

The effects of that crisis still are rippling through more than a year later, as our system inches toward recovery.

Now, U.S. senators are debating financial regulatory changes to toughen regulation and tighten market oversight. It's clear that some changes are in order.

But as lawmakers debate the details of these sweeping reforms, they must be mindful not to extend government's reach too far - not to squeeze the market with so much additional bureaucracy so as to choke its productivity and growth.

Senators must use a fine brush to close regulatory gaps and fix flaws while leaving ample room for the market to operate effectively. Strengthen enforcement of existing operations (i.e., Securities and Exchange Commission), don't just add new layers.

We'll be paying for the bailouts of 2008 and 2009 for a long time to come. Our country can't afford to do that again. But shutting down the sectors of our economy that are working will only make matters worse. Too much red tape will stifle the creativity and innovation that allows our economy to flourish - from Wall Street to towns large and small here in Iowa.

Tread wisely, Senators, and leave us room to grow.