When jobs go offshore, it’s normal for the affected industries to go crying to Congress. Usually, Wall Street tells those affected industries to suck it up and stop whining. What happens when foreign market exchanges start attracting business away from Wall Street, though? They go crying to Congress…

When Main Street jobs go overseas, Wall Street generally shrugs. The typical response from the nation’s financial elite is that people who have lost work should tough it out and acquire new skills.

Now the tables may be turning, as Wall Street ponders its own potential job losses. Foreign companies are increasingly bypassing New York and listing their shares on overseas markets. If the trend continues, it could mean the migration of high-paying investment banking jobs.

The horror! Faced with this threat, Wall Street and its political supporters have sprung into action, commissioning studies and urging that the government help by easing post-Enron accounting regulations, adopting lawsuit reform and pre-empting state banking regulations.

The article points out that the regulatory and legal framework could use some relaxing. And I completely agree. If Wall Street’s version of protectionism is to get the government out of the freakin’ way, I guess I’m a protectionist today!

The tone of this article is a bit of schadenfreude, “look at how Wall Street is hypocritical about outsourcing!” But it’s not true. The other industries are looking for government to step into their industries, increasing regulation on other people to make it harder for them to compete. Wall Street is asking for a reduction in regulations in order to allow them to compete.

Now, I’m sure the writer hasn’t really studied how regulations get written, based on this statement:

Moreover, regulations are not designed to protect investment bankers. They are to protect investors and consumers.

They’re designed to make investors and consumers think they’re being protected while forcing small and medium-sized businesses to spend exorbitant amounts complying with regulatory hurdles, which give big businesses an advantage. Regulations benefit the people who write them, and those people are the lobbyists for big business.

Instead, this story is about one group (investment folks on Wall Street) pushing back against regulations paid for by other privileged groups (big business). It’s easy to lump Wall Street in the same bucket as big business, but they’re very different, and they’ve got different incentives in their businesses.

If we’d relax our regulatory burden on all American business, including Wall Street, we’d see less outsourcing overall. Not that we’d see none, of course, because division of labor is a fundamental good, and sometimes it makes more sense to move jobs overseas. But our government is actively forcing outsourcing with their insane regulatory burden. The author of this article lambasts Wall Street for their “hypocrisy”, but I’ll bet that Wall Street is advocating less regulation on other businesses, not just their own.

Let’s get the government out of all of our paths. If they start with Wall Street, that’s just fine. As long as they start!