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tom zeller, jr. writes in the new york times about criticisms leveled at the nuclear regulator commission and it’s relationship and the nuclear industry. sounds like s&c. sounds like the insurance industry. speaking of, apparently states are now moving to allow insurance companies to use their financial reserves to create captives, little-regulated accounts used to create special insurance subsidiaries. you can read mary walsh’s and louise story’s article about it here in the ny times. i won’t claim to be an expert on the matter, but it seems to me an instance where insurance companies can now use money once held in reserve to play with. there doesn’t seem to be any standard for how much money should be held in reserve. the states claim they can tax premiums that captives bring in and that the establishment and regulation of captives will bring in new employees. perhaps they’re right and there’s little to be concerned about. frankly, it’s something i don’t know enough about to evaluate with any certainty. but articles i’ve read about coziness among regulators and the regulated and about companies’ willingness to take on financially risky endeavors leave me concerned.
