INVESTING: Interference from government is bad for business

On my way into work the other day, I heard an analyst on Bloomberg Radio say he was surprised at the poor performance of the parent company of Airbus, EADS. He said he was ready for a slight earnings miss, but to fall on its face as much as it did, well, that shocked him.

What shocked me was how anyone put faith in a giant conglomerate pretty much run by the French government and a few other half-baked socialist regimes in Europe.

I was in the Singapore airport in September and there were signs everywhere about Singapore Airlines’ being the first airline to launch the A300, which is the supposed modern-day answer to Boeing’s 747. As soon as I got home, Airbus announced massive delays on the A300, which put the product at least two years behind schedule. That leaves Singapore airport with some useless signs, and the French government with a little egg on its face-with Hollandaise sauce, of course!

Despite the brainpower and cooperation of a dozen EU nations, and subsidies that would make FDR proud, Airbus simply can’t hang with Boeing. Boeing has had to work under the harsh lights of the greatest capitalistic system in the world, and the discipline that imposes has created an exceptional corporation. While Airbus and EADS are suffering, Boeing stock is flirting with an all-time high. There is no question the problems at Airbus are helping move Boeing’s stock higher.

While too much regulation and government involvement in heavy industry is hurting European companies, European countries are rapidly closing the gap on us in the flexibility of their financial markets.

Even though much of the positive changes are happening in England (which has not yet adopted the euro), Germany, France and Italy are catching on. Companies from all over the world are finding it easier to raise capital and list on European exchanges than here. This is primarily due to the oppressive nature of the Sarbanes-Oxley Act, which is intended to reduce the likelihood of corporate fraud.

This law should be dismantled. Christopher Cox, head of the SEC, apparently doesn’t agree with me, however. Reacting to criticism from financial types like Warren Buffett and politicians from both parties, Cox said the law is sound; it just needs better implementation.

I love when Wal-Mart comes up for discussion in front of liberals. They cringe as they put the worst labels imaginable on the retailing giant. But to those millions of Americans whom the liberals claim to champion-including just about every middle-class person in this country-Wal-Mart is a godsend.

Under threats from critics and politicians, Wal-Mart recently pulled its charter for a merchant bank.

Why deny the American consumer the benefits Wal-Mart might have been able to provide? The energy company Halliburton just announced it’s moving its corporate headquarters to Dubai. Its officials cited burdensome regulations and government interference. With Wal-Mart being treated like this, can it be far behind?