Eleutherian

Venture capitalists are the backbone of private investment. However, the Obama administration wants to increase regulations, making their job more costly and less efficient. According to Steve Forbes:

Even though most venture capital outfits are relatively small and rarely, if ever, use debt, the Treasury wants to apply a bewildering array of rules similar to those for investment advisors and banks. Thus, instead of focusing on funding the next potential Apple, Microsoft, or Oracle, VCs will have to devote considerable time and resources to filling out disclosure and compliance forms. Treasury Chief Timothy Geithner's lame excuse is that since reform should cover the entire financial industry, leaving out venture capitalists would be a form of discrimination. Alas, there's more at work here than pigheaded logic.

This Administration truly believes that the private sector is a destructive, unguided missile that needs the constant and close supervision of Washington politicians. Without it we'd be subject to more disasters like the current financial crisis. In other words, Washington doesn't like the idea of venture capitalism because VCs and the entrepreneurs they fund create and do things without anyone's permission.

While Forbes may or may not be paranoid about the administration's intentions, the regulations will truly have a chilling effect on private investment. If the private sector cannot provide the investment in technology necessary to stimulate the economy or protect the environment, then the government will be forced to spend yet more taxpayer money.