May 14, 2019
The all-powerful American Auto Industry exists today thanks to the British Locomotive Act of 1865, also known as Red Flag Act (since it mandated a red flag walker in front of all transiting cars). This set back the British auto industry for several decades and allowed the great American companies to thrive. Great Britain lost millions of jobs, know-how and put a chokehold on technological innovation.
The auto industry didn’t die because of this regulatory choke. It only grew stronger, in more friendly jurisdictions, and allowed rivals such as the US and Germany to excel in the car industry much sooner. Because of such overreaching regulation, and many other contributing factors, Great Britain eventually lost its status as the main world power and was forced to play catch up when war knocked at its doors.
This anti-fragile nature of newly born industries is repeating today with Crypto assets. If you want the jobs, the innovations, the wealth creation, and the Henry Fords to happen in the U.S.A., don’t repeat the historic errors of previous regulators.
Regulation is a living, breathing thing, if you want to err on the side of caution to protect American investors as it is your job, you can always be extra permissive early and later monitor and adjust according to results. Doing it in any other way is not going to make a new global industry to disappear, it will only cause it to grow somewhere else where your rules don’t apply, and will ultimately only hurt us all.